When an owner tells me they need more leads, I don't start with ads. I start with five numbers.

Here's why. It almost always traces back to one real pressure: cash. The business needs more cash. But that's not how owners say it. They say "we need more sales," and from there the mind jumps straight to "we need more leads."

The problem is, those are three different things. The need is cash. More sales is one way to get it. More leads is one way to get more sales. And at each jump, you can bet on the wrong fix.

So the first question isn't "how do we get more leads." It's "do we solve this cash problem by selling more, or by managing better?" Sometimes the answer is sales. Just as often it's margins, overhead, collections, or a close rate that's leaving money on the table.

So before we spend a dollar on lead generation, we run what I call the Fast 5.

The Fast 5

1. Top-line revenue. What's coming in, and which direction it's moving. The trend matters more than the number.
2. Gross profit. What's left after the cost of delivering the work. If this is thin, more leads means more work at a margin that doesn't pay you.
3. Net profit. What's left after overhead. This is usually where the cash flow problem is hiding.
4. Cost of acquisition. What it costs you to win one customer. Count everything: ads, salespeople, commissions, tools, anything generating leads. Not just the ad spend.
5. New leads and close rate. How many leads come in, and how many turn into customers. If you close 1 in 10 and you could close 3 in 10, you don't need more leads. You need a better sales process.

What the numbers usually tell me

Once the five numbers are on one page, the real problem tends to show itself. Sometimes it's pricing. Sometimes overhead grew faster than revenue. Sometimes leads are coming in and nobody is following up.

And sometimes it really is a lead problem. But you only know that after you've ruled out the other four.

What it looks like when the numbers are working

One of our clients, a Chicago-area moving company, tracks all five. This year their revenue reached $1.298 million, up $573,000 over last year. At the same time, their cost per acquisition dropped to $108, a decrease of $147.

Revenue up while the cost to win each customer goes down. That's the picture you want. And you can only see it if you're measuring it.

Run yours this week

You don't need a consultant to start. Block an hour and pull:

• Your last 12 months of revenue, by month
• Gross and net profit from your P&L
• Everything you spent to bring in new business: ads, sales payroll, commissions, tools
• How many leads came in and how many you closed

Write the five numbers on one page. Then ask one question: if I doubled my leads tomorrow, would I make more money, or just get busier?

If you're not sure what the numbers are telling you, that's what we do. Book a Fast 5 review with Atlas.