Change either value. The other adjusts automatically.
Not sure of your margin? Calculate it from a typical job:
Enter what you charge and what it costs for a typical full install: HVAC changeout, repipe, panel upgrade, etc.
$
$
Direct costs = equipment, parts, labor, permits
Gross Profit$4,000
Margin47.1%
Markup88.9%
Enter what you charge and what it costs for a typical service call: repairs, diagnostics, tune-ups.
$
$
Direct costs = parts, labor, truck roll
Gross Profit$225
Margin50.0%
Markup100.0%
Margin--
Margin is gross profit as a percentage of what the customer pays. Markup is gross profit as a percentage of your direct costs.
Example: A Service Call
1
You charge the customer
$450
2
Your direct costs (parts, labor, truck roll)
$225
3
Gross profit on that call
$225
→
Margin = $225 ÷ $450
50.0%
→
Markup = $225 ÷ $225
100.0%
3
Your Investment Percentage
What percentage of projected revenue are you willing to invest?
8%
Maintain
10%
Grow
12%
Dominate
The higher the percentage, the faster the growth. Choose what you can commit to.
%
10% of projected revenue
Rent and wraps are advertising. If people see them, they count. So we deduct them from your budget.
4
Annual Rent
Include rent if your location has good passing traffic and a big sign. Leave it at zero if you are in an industrial estate and customers never see it.
$
5
Vehicle Wraps This Year
An attention grabbing wrapped van is a moving billboard. An average wrapped van is not. Enter the cost of wraps for the projected year. The full cost is deducted from your ad budget. Do not include vehicles already wrapped. Only the ones for the coming year.
$
Total Wrap Investment$3,000
$
Rent + Wraps Total$0
Your Ad Investment
Your cost of exposure is above $1 million. At this level your actual spend should be guided by what media is available in your market. Your Wizard of Ads partner can help you build a media plan.
At this budget level the formula is a reference point rather than a prescription. Media saturation, market size, and your brand's established position all affect what you can actually spend. Talk to your Wizard of Ads partner before committing to these figures.
Your rent has consumed most or all of your advertising budget. Your location may be doing heavy lifting — or your rent is high relative to revenue. Double-check your numbers.
Most advisors give you an opinion. This gives you a calculated number built on 40+ years of advertising experience. But at the end of the day, the final decision on how much to invest is yours to make.
1
Selected percentage of projected revenue
2
Margin → Markup
3
4
What Does This Budget Cover?
Paid Advertising — Included
Radio: mass reach, frequency, share of mind
Television: broadcast and cable
Google Ads / PPC: search demand capture
Local Service Ads: in-market lead capture
Streaming / OTT: connected TV, pre-roll video
Billboards / OOH: outdoor and transit
Streaming Audio: Spotify, Pandora, podcasts
YouTube: pre-roll, in-stream, brand video
Meta Ads: bonding and activation campaigns
Retargeting: follow-up direct response
Flyers and Door Hangers: letterbox campaigns
Yard Signs: local street-level awareness
Promotional Items: branded merchandise
Budgeted Separately
Ad Production: studio time, editing, scriptwriting
Talent Fees: voiceover artists, on-screen talent
Photography and Video: shoots and creative assets
Website: design, hosting, maintenance
SEO / Content: organic search optimisation
Email / SMS: direct response to your list
Consulting and Strategy: separate from media spend
For where to invest your ad budget, speak to your Wizard of Ads partner.
