The research is unambiguous: the longer a lead waits, the less likely it converts, and the drop is steep in the first day. This puts that on your numbers — enquiries, value, your current turnaround and your win rate when a quote goes out the same day. The result is the revenue that went to whoever answered first.
Harvard Business Review audited 2,241 companies and found an average first response of 42 hours, that 23% never responded at all, and that firms which contacted a lead within an hour were about seven times more likely to qualify it than those who waited even an hour longer. Trades quote in days, not hours. This tool applies a decay you set to your own win rate and prices the jobs that go to whoever answered first.
Start from the win rate you achieve when a quote goes out the same day — your best case, the one where the customer is still interested and has not rung anyone else. Then apply a decay for every day of delay: at 15% relative per day, a 30% same-day rate is 25.5% after one day, 21.7% after two, 18.4% after three. Multiply each by your enquiries a year and you have jobs won at today's turnaround and jobs won at the target. The difference, at your average order value, is revenue that went elsewhere; at your gross margin, it is profit.
The decay is the assumption the whole thing turns on, which is why it is a slider and not a constant. The HBR research found the odds of qualifying a lead fell about sevenfold between the first hour and the second; that is a much steeper curve than 15% a day, and it concerned online B2B leads rather than a fencing customer waiting on a price. So the default is set well below it. If you have your own figures — conversion on quotes sent same-day against those sent after three — put the implied decay in and the tool becomes yours.
Because the quote needs a desk. The surveyor measures the job, then goes back to the van or the office to work out bays, posts, gravel boards and concrete from a printed list, then writes it up and emails it. The salesperson takes the list of plants on the phone, then searches the website for what is in stock, cross-checks a spreadsheet for what it should cost, writes the quote and sends it. Neither is slow through carelessness; they are slow because the price lives somewhere other than where the customer is.
In the fencing business the surveyor now draws the fence on a tablet while measuring it, the price comes out of the drawing, and the customer gets a number at the door and can negotiate it there. In the nursery quoting went from fifteen minutes to two or three, on the call. Both took the turnaround to zero, and the compounding matters: a customer quoted by somebody else buys from them next season too.
Sixty enquiries a month is 720 a year. A 30% same-day win rate decayed 15% a day for three days is 18.4%: 133 jobs. At the door, 30%: 216 jobs. Eighty-three more, at £1,500 each: £125,000 of revenue and £25,000 of gross profit at a 20% margin. And that is before the fifteen-to-twenty-a-day peak weeks when, at fifteen minutes a quote, some enquiries never got a quote at all — which the cost of standing still counts separately.
Measure your real turnaround from an enquiry log rather than remembering it; the average is always longer than the best day. Then ask where the price lives. If a quote needs a desk, a spreadsheet and a callback, the fix is the price book in a system — a catalogue the quote is built from, on the call or at the door — and that is where the operations audit starts for any business that quotes. The other calculators cover the hours, the hire and the margin, and the short version of the method is on the byHoratio homepage.
As close to the enquiry as the price allows. Harvard Business Review's 2011 audit of 2,241 companies found firms that responded to a lead within an hour were about seven times more likely to qualify it than those that waited even an hour longer, and that the average first response was 42 hours. For trades the practical answer is a number on the call or at the door, which is what a quoting system built around the price book makes possible.
It is a conservative assumption, not a measured constant, and it is a slider for that reason. The published lead-response research implies a much steeper fall in the first hours than 15 per cent a day; the default is deliberately set well below it because that research concerned online B2B leads and qualification rather than trade quotes and wins. If you can compare your own win rates on same-day quotes against three-day quotes, put the implied decay in.
It varies enormously by trade, ticket size and how the enquiry arrived, so the calculator asks for yours rather than assuming. What matters here is the gap between your best case — the win rate when you quote the same day — and what you actually achieve at your real turnaround. That gap is the cost of delay, whatever the absolute figures are.
Lost. A customer who has rung three firms and received one quote generally goes with the one that answered. The others' quotes arrive after the decision has been made, and worse, that customer now has a supplier they trust for next time. The compounding is the reason the fencing and nursery businesses in the case studies treated speed of quoting as the first thing to fix.
Only if it is faster because someone guessed. A quote produced at the door from a drawing and a price book — 57 items and 29 rules in the fencing system — is both faster and more consistent than one worked out on a calculator in the van, because the pricing knowledge is in the software rather than in whichever surveyor turned up.
A number at the door beats a PDF on Thursday. Put the price book where the customer is. Twenty minutes, no deck, no pitch.
HORATIO@BYHORATIO.COM
A price at the door, adjustable on the spot, from the survey the surveyor just drew.
The enquiries that never get a quote at all, derived from capacity.
The hire, the charge-out rate, the margin leak, and more.