A bad lead vendor does not cost you the setup fee. It costs you a quarter. Three months of ad spend out of your own pocket, a sales rep sitting on garbage leads, a crew you hired for volume that never showed up, and a season you cannot get back. By the time the numbers are clear enough to argue about, you are 90 days into a 12-month term and the person who sold you is no longer answering.
The pitch call is where that gets decided. Not the reporting dashboard, not the onboarding form. The pitch call. Most contractors ask two questions on that call: what does a lead cost, and how many can you send. Both are the wrong questions. Here are the twelve that actually predict how the next year goes.
What are you actually signing when you hire a lead company?
There are three business models in contractor marketing and they behave completely differently. Knowing which one is across the table changes every other question you ask.
| Model | What you pay | Who carries the risk | Where it breaks |
|---|---|---|---|
| ModelLead marketplace (aggregator) | What you pay$15-85 per lead, often shared with 3-5 contractors | Who carries the riskYou | Where it breaksClose rates of 5-12 percent, and you are racing three companies to the same phone |
| ModelRetainer agency | What you pay$2,000-$10,000+ per month plus ad spend | Who carries the riskYou | Where it breaksPaid whether the phone rings or not, results lag 3-6 months |
| ModelPerformance partner | What you paySetup fee plus a fee per delivered lead or booked appointment | Who carries the riskShared | Where it breaksOnly works if the leads are genuinely exclusive and the fee is tied to delivery |
None of these is automatically the right answer. A marketplace can fill a slow week. A retainer agency makes sense when you want long-horizon SEO and brand work. A performance model makes sense when you want the vendor's income tied to your lead flow. The breakdown of when each one fits is covered in our ranked comparison of contractor lead generation services, and in more depth in pay per lead vs. monthly retainer.
What is not acceptable is a vendor who will not tell you plainly which model they are running. If the proposal blends a setup fee, a monthly management fee, a per-lead fee, and your ad spend into one number, that is not a package. That is camouflage.
Why does the per-lead price tell you almost nothing?
Because the price on the invoice is not the price of a customer. Cost per acquired job is the only number your P&L reacts to, and it is a function of close rate, which is a function of exclusivity and speed.
| Channel | Typical cost per lead | Typical close rate | Cost per acquired job |
|---|---|---|---|
| ChannelReferrals and past customers | Typical cost per lead$0 | Typical close rate40-60% | Cost per acquired jobNear $0 |
| ChannelOrganic search and Google Business Profile | Typical cost per lead$0-50 | Typical close rate20-40% | Cost per acquired job$100-250 |
| ChannelShared marketplace leads | Typical cost per lead$25-75 | Typical close rate5-12% | Cost per acquired job$300-1,200+ |
| ChannelMeta advertising, self-run | Typical cost per lead$25-110 | Typical close rate10-20% | Cost per acquired job$250-1,100 |
| ChannelExclusive leads from a performance partner | Typical cost per lead$50-200 | Typical close rate15-25% | Cost per acquired job$200-1,000 |
| ChannelExclusive booked appointments | Typical cost per lead$200-400 | Typical close rate25-40% | Cost per acquired job$200-1,200 |
Run the two extremes. A $50 shared lead closing at 5 percent costs $1,000 per signed job. A $150 exclusive lead closing at 25 percent costs $600 per signed job, and it took your rep four conversations instead of twenty. The cheaper lead is three times the price of the expensive one, and it burned a hundred hours of somebody's year getting there. The full math on that gap sits in exclusive vs. shared leads.
So when a vendor leads with "our leads are only $39," the correct response is not "great." It is "exclusive to me, and what closes."
What are the 12 questions to ask before you sign?
Ask all twelve. Write the answers down. A company that is running a real system will answer every one of these in under a minute each. A company that is reselling somebody else's traffic will start qualifying, deflecting, or promising to "get you that from the team."
Questions about the leads themselves
- Is every lead exclusive to my company, in writing? Not "mostly exclusive." Not "exclusive within your zip codes unless volume requires." Exclusive means one contractor, one lead, never resold. Get the word in the agreement.
- Where do the leads come from? Meta ads? Google search? A partner network? A shared database being re-marketed? If they cannot name the channel and show you a live ad, they are buying the lead somewhere else and marking it up.
- What defines a qualified lead, and who decides? Get the specific criteria: correct phone number, inside your service area, homeowner, project intent, requested timeframe. "Qualified" without a written definition is a word that will be used against you in month two.
- How fast does a lead reach my CRM, and in what format? Real-time push into your system beats a spreadsheet at 5 p.m. Every hour of delay drops your contact rate hard, which is the whole argument in speed to lead.
Questions about ownership
- Whose ad account do the campaigns run in? This is the question most vendors hope you skip. If the campaigns run in the vendor's account, then the pixel data, the audience lists, the retargeting pools, and the learning phase all belong to them. Leave, and you leave with nothing. If campaigns run in your account, you see every dollar of spend as it happens, and the asset stays with your company.
- Whose brand appears on the ad and the landing page? Ads under your company name build recognition you can compound. Ads under a generic "Free Roof Estimate" brand build the vendor's asset while you pay for the traffic.
- Who owns the phone numbers, forms, and creative if we part ways? Ask what happens on day one after cancellation. If the landing page goes dark and the tracking numbers get reassigned, you were renting.
- Can I see the ad account and the reporting myself, live? Not a PDF summary. Login access or screen-share access to the actual account. Marketing spend you cannot inspect is marketing spend you are guessing about.
Questions about the money and the exit
- What is the total first-90-day cost, itemized? Setup fee, per-lead or per-appointment fee, monthly fee if any, and estimated ad spend paid directly to the platform. You should be able to write the whole thing on an index card. For reference, Minyona charges a one-time $2,000 setup, normally $4,000, then from $50 per qualified lead or from $200 per booked appointment, with ad spend paid by you directly to Meta out of your own account.
- What is the dispute policy, in writing? Wrong numbers happen. Renters happen. Out-of-area happens. The question is whether there is a one-click process with a stated window and a real approval rate, or whether disputes go into an email address nobody reads.
- What is the term, the notice period, and the auto-renewal? Month-to-month or a defined 60-to-90-day pilot is the healthy answer. A 12-month term with a 90-day cancellation notice is a 15-month term.
- Who is the actual person running my campaign, and how do I reach them? Name, role, and the channel you use to reach them. If the answer is a support ticket queue, you will find out how that works during your busiest week.
The scoring rule
Count the questions that got a direct, specific answer. Nine or more, keep talking. Six to eight, ask the missing ones again in writing before signing anything. Five or fewer, you are being sold a package, not a system.
If you want to pressure-test the numbers a vendor gives you against your own close rate and job value, run them through the lead ROI calculator before the second call, not after the contract.
What answers should make you walk away?
Some answers are not gray areas.
- "We guarantee 40 leads a month." A guaranteed count with no quality definition is a promise to hit a number, and there is always a way to hit a number. Ask what happens to lead 41 and what defines lead 1.
- "We run it out of our ad account, it is easier that way." Easier for whom. This is the single most expensive convenience in contractor marketing.
- "Leads are exclusive, but we may serve other contractors in your area." Then they are not exclusive at the level that matters, which is the homeowner.
- "We can't share close rates, that depends on you." Partly true, and still a dodge. A vendor with a real book of business knows the range their clients close at and will say it out loud. Specifics on any track record should be available on request, not withheld on principle.
- "Sign today for the discounted rate." A deadline on a marketing contract is a sales tactic, not a business condition.
- No written dispute process. If the only remedy for a bad lead is a conversation, the incentive to filter bad leads is zero.
One more, quieter than the others: a vendor who never asks about your capacity. If nobody asks how many appointments your reps can run, how many crews you have, or what your average ticket is, they are not building around your business. They are pointing a firehose at it and billing per gallon.
How do you test a lead company without betting the season on it?
Run a pilot with a defined shape. Four steps.
- Set the window. 60 to 90 days. Long enough to get past the learning phase on a Meta campaign, short enough that a bad fit is a bruise instead of a year.
- Set the volume and the budget. Pick a lead count you can actually work with the reps you have today. Twenty well-handled leads beat sixty ignored ones, and the vendor's numbers will look better too, which keeps everyone honest.
- Set the measurement in advance. Cost per acquired job, close rate by source, average ticket by source, and speed to first contact. Agree on the definitions before the first lead lands, because after a slow month everyone's definitions get creative.
- Set the review date. Put it on the calendar during onboarding. Bring the CRM export, not impressions.
A vendor who welcomes that structure is confident in the system. A vendor who resists it is hoping ambiguity buys them a few extra months of billing.
What does a fair contract actually look like?
| Term | Fair | Watch out |
|---|---|---|
| TermExclusivity | FairOne contractor per lead, stated in writing | Watch out"Limited sharing," "exclusive by category" |
| TermAd account | FairYours, you see spend live | Watch outVendor-owned, summary reports only |
| TermTerm length | FairMonth-to-month or 60-90 day pilot | Watch out12 months with 60-90 day notice |
| TermSetup fee | FairOne-time, itemized, tied to a build | Watch outLarge fee plus retainer plus per-lead fee |
| TermDispute policy | FairWritten window, defined reasons, fast approval | Watch outCase-by-case, verbal only |
| TermData ownership | FairPixel, audiences, and lists stay with you | Watch outVendor keeps the asset on exit |
| TermReporting | FairLive access to account and lead detail | Watch outMonthly PDF |
| TermTermination | FairClean exit, assets transfer | Watch outAssets go dark, numbers reassigned |
None of this is exotic. It is the same standard you would apply to a subcontractor: scope in writing, price in writing, what happens if it goes wrong in writing, and an exit that does not require a lawyer.
The short version
The per-lead price is the number vendors want you focused on, because it is the only one they fully control. Exclusivity, ownership, and close rate are the numbers that decide whether this works, and they are the ones that take an extra question to surface.
Ask the twelve. Score the answers. Pilot before you commit. If a vendor makes any of those three things difficult, that difficulty is the data.
If you want to see how a system that runs in your own ad account, with exclusive leads and a written dispute process, would look against your current numbers, book a call and we'll walk your actual math. Bring your close rate, your average ticket, and last quarter's lead source report. Twelve questions, honest answers, and no deadline on the offer.
Frequently asked questions
What is the single most important question to ask a lead generation company?
Ask who owns the ad account, the pixel, and the audience data, and whether every lead is exclusive to your company. Ownership and exclusivity determine whether you are building an asset or renting one, and they are the two answers vendors are most likely to talk around.
How long should a contractor lead generation contract be?
Start month-to-month or on a defined pilot of 60 to 90 days. Anything longer than six months with an auto-renewal and a 90-day cancellation notice is a lock-in, not a partnership, and you should assume it exists because the results do not hold up on their own.
Is a setup fee normal for a contractor lead generation company?
Yes, a one-time build fee is normal when someone is creating landing pages, ad creative, tracking, and CRM routing from scratch. Minyona charges a one-time $2,000 setup, normally $4,000, with no monthly retainer. What is not normal is a large setup fee plus a monthly retainer plus a per-lead fee with no accountability attached to any of them.
How do I compare two lead companies that price differently?
Convert both to cost per acquired job. Divide total monthly spend, including fees, retainers, and ad spend, by the number of jobs you actually signed from that source. A $50 shared lead closing at 5 percent costs $1,000 per job. A $120 exclusive lead closing at 25 percent costs $480 per job.
What are the biggest red flags in a contractor lead gen contract?
Guaranteed lead counts with no quality definition, campaigns run in the vendor's ad account instead of yours, no written dispute policy, a 12-month term with a long cancellation notice, and refusal to name the person actually running the campaign. Any one of those should slow you down.
Frequently asked questions
What is the single most important question to ask a lead generation company?
Ask who owns the ad account, the pixel, and the audience data, and whether every lead is exclusive to your company. Ownership and exclusivity determine whether you are building an asset or renting one, and they are the two answers vendors are most likely to talk around.
How long should a contractor lead generation contract be?
Start month-to-month or on a defined pilot of 60 to 90 days. Anything longer than six months with an auto-renewal and a 90-day cancellation notice is a lock-in, not a partnership, and you should assume it exists because the results do not hold up on their own.
Is a setup fee normal for a contractor lead generation company?
Yes, a one-time build fee is normal when someone is creating landing pages, ad creative, tracking, and CRM routing from scratch. Minyona charges a one-time $2,000 setup, normally $4,000, with no monthly retainer. What is not normal is a large setup fee plus a monthly retainer plus a per-lead fee with no accountability attached to any of them.
How do I compare two lead companies that price differently?
Convert both to cost per acquired job. Divide total monthly spend, including fees, retainers, and ad spend, by the number of jobs you actually signed from that source. A $50 shared lead closing at 5 percent costs $1,000 per job. A $120 exclusive lead closing at 25 percent costs $480 per job.
What are the biggest red flags in a contractor lead gen contract?
Guaranteed lead counts with no quality definition, campaigns run in the vendor's ad account instead of yours, no written dispute policy, a 12-month term with a long cancellation notice, and refusal to name the person actually running the campaign. Any one of those should slow you down.