The Only Numbers That Matter in Junk Removal: LTV, CAC, COGS, and EBITDA in Plain English

A junk removal company doing $1,000,000 a year sounds unstoppable. Then you learn the owner spent $450,000 doing the jobs, $350,000 running the office and buying leads, and kept $200,000 before taxes. Same company, completely different story. The difference between the headline and the truth is a handful of junk removal KPIs, and most owners never track a single one.

I ran my junk removal business to over $1M gross in the LA area, and the numbers above are the simplified model of my own company. I am not an accountant and this is not financial advice. It is the plain-English version of the metrics I wish someone had explained to me in month one: LTV, CAC, COGS, and EBITDA, with junk removal examples instead of textbook ones.

Grab your last month of numbers and follow along. By the end you will know whether your ads are making you money or quietly draining you.

Gross revenue is a vanity metric

Gross revenue is the number everyone brags about and the least useful number you have. It tells you nothing about whether the business works. My $1M year proved it: after cost of goods sold and operating expenses, the operating income was $200,000. Solid, but a fifth of the bragging number.

Before the fancy metrics, get the boring foundation right. There are three financial statements: the balance sheet, the income statement (your P&L), and the cash flow statement. You want a P&L every single month. Use a bookkeeper or a service for the books and keep a CPA for tax strategy. If you cannot see last month's profit by the 10th of this month, fix that before touching a single ad campaign.

I made a full video walking through all of this, including why your ads might not be converting, at https://www.youtube.com/watch?v=NuFk4xiszAg.

COGS: what it actually costs to do the job

COGS (cost of goods sold) is everything it costs to physically deliver the service. In junk removal that means three things: the labor on the truck, the fuel, and the dump fees.

In my simplified $1M model, COGS was $450,000, or 45% of revenue. The benchmark ranges I use for junk removal:

Revenue minus COGS is your gross profit. In the model: $1,000,000 minus $450,000 leaves $550,000 gross profit. That is the pool that has to pay for everything else: marketing, call center wages, software, rent, insurance, admin. Those operating expenses ran $350,000 in my model, leaving $200,000 in operating income.

If you do not know your COGS percentages, stop guessing and run your real numbers through a COGS calculator. A junk removal company with dump fees creeping past 12% of sales has a pricing problem or a disposal problem, and no amount of new leads fixes either one.

CAC: what a customer costs you

CAC is customer acquisition cost: everything you spend to win customers, divided by the customers you won. That includes ad spend and the sales and marketing payroll behind it, not just the Google bill.

Here is the worked example from my own account. Say you spend $20,000 on Google Ads in a month at a $50 cost per lead. That is 400 leads. Close 50% of them and you booked 200 customers. Your CAC is $100.

Now put that against a $400 average job size. The job is $400, acquisition took $100, and COGS takes another 45%, about $180. You are left with roughly $120 before any overhead touches it. That is why a company can book 200 jobs a month and still feel broke. The headline said $80,000; the math kept a fraction.

This is also why average job size is a KPI, not trivia. Moving the average ticket from $400 to $477 changes every downstream number without spending another ad dollar.

LTV: what a customer is worth over time

LTV (lifetime value) is what a customer is worth across the whole relationship, not just today's ticket. Tech companies with subscriptions live on this metric. Junk removal is trickier because nobody subscribes to junk, so I sat down with Xavier Caldera of Junkify, a guy who went from junk removal helper to truck captain to ops manager to franchise consultant to owner, to work through how it applies to us.

The short version: LTV has to include more than average ticket. You need average job size, gross margin, how often customers come back, and how long they stay customers. A $400 customer who calls you twice more over three years and refers a neighbor is not a $400 customer.

The ratio that matters is LTV to CAC. The healthy target is about 3:1, meaning a customer is worth roughly three times what they cost to acquire. Below 1:1 you are paying to lose money. Way above 3:1 usually means you are underinvesting in growth and could be buying more customers profitably. Marketing is only an investment if you know the customer is worth more than the acquisition cost. Otherwise it is a hobby with invoices.

One honest warning: most home service CRMs do not surface repeat-customer behavior or CAC at all, so owners end up tracking this manually. It is one of the gaps I kept hitting as an operator, and it shaped what we put in Autopilot's dashboard and reporting.

EBITDA without the accounting degree

EBITDA is earnings before interest, taxes, depreciation, and amortization. Plain English: what the business itself earns before financing choices and tax treatment muddy the picture. Two identical companies can show different net income just because one financed its trucks and the other paid cash. EBITDA strips that noise out so you can see operating performance.

You do not need to compute it weekly. You need it when you compare year over year, when you talk to a lender, and especially when you ever want to sell. Buyers do not pay for gross revenue. They pay for provable earnings, which is one more reason monthly P&Ls matter.

The junk removal KPIs to track every month

Here is the full monthly scorecard, in plain terms:

• Average job size (AJS): total sales divided by jobs. Mine ran around $400-477.
• Cost per lead (CPL): ad spend divided by leads, per channel.
• Close rate: booked jobs divided by leads. A 50% swing here doubles or halves your CAC.
• CAC: total acquisition spend divided by new customers.
• LTV and the LTV:CAC ratio: aim near 3:1.
• COGS %: labor, fuel, dump fees against sales.
• ROAS: revenue from a channel divided by spend on that channel.

Track them monthly, by lead source. Weekly numbers in junk removal are too volatile to mean much; one hoarder house or one rained-out Tuesday skews everything. But I also kept a daily P&L per truck, because busy days can lose money. I watched days with $1,000 to $2,000 in revenue evaporate after $400 to $900 in Google Ads, fuel, dump fees, labor, card fees, payroll tax, workers comp, and a popped tire. Daily tracking is not accounting; it is discipline.

Why your ads "don't convert" (it's usually tracking)

Every week an owner tells me Google Ads does not work. When I dig in, the ads are usually fine and the measurement is broken. They are judging a channel with no idea which calls came from it.

The fix is unglamorous: separate tracking phone numbers per channel, separate landing pages, and a source tag on every job in the CRM. If a Facebook lead calls the number on your truck two weeks later, sloppy tracking books that as a "truck" job and Facebook eats the blame. Call tracking per channel is the single cheapest fix in your whole marketing stack, and where the money hides is covered deeper in my breakdown of Facebook ads that actually booked jobs.

Once every job has a source, CAC by channel falls out automatically, and the decision gets easy: feed the channels beating 3:1, starve the ones under 1:1.

Spreadsheet or CRM?

Honest answer: start with the spreadsheet. A free Google Sheet with income, tips, payroll, fuel, landfill, ads, card fees, and fixed costs will teach you more in 30 days than any software demo. Only money actually collected counts; a net-30 invoice is not revenue until it hits the bank.

The spreadsheet breaks when the data entry does. Around 40 or 50 jobs a month, you stop filling it in at 9 p.m., and a tracker you skip is worthless. That is the point of a CRM that captures source, job value, and payment automatically as work happens, so the KPI report is a byproduct instead of a chore. I wrote about what those numbers looked like at full scale in my $1M profit margin breakdown.

FAQ: junk removal KPIs

What KPIs should a junk removal business track?

Monthly, by lead source: average job size, cost per lead, close rate, customer acquisition cost, LTV to CAC ratio, COGS percentage, and return on ad spend. Plus a simple daily profit tracker per truck so a losing day never hides inside a busy week.

What is a good LTV to CAC ratio for home services?

Around 3:1 is the standard target: a customer worth three times what they cost to acquire. Under 1:1 means you lose money on every customer you buy. Far above 3:1 often means you could profitably spend more on growth than you are.

What is included in COGS for junk removal?

The costs of physically doing the job: truck labor (around 25% of sales), dump fees (8-12%), and fuel (3-5%). Office staff, software, insurance, and marketing are operating expenses, not COGS. Keeping the two separate is what makes gross margin meaningful.

Why does my revenue look great but my bank account doesn't?

Usually some mix of high CAC, untracked COGS creep, and counting invoices as income before they are paid. Run one month of real numbers: revenue minus COGS minus ad spend minus overhead. The gap between gross and kept is almost always ads and labor.

Know your numbers without the night shift

Every KPI in this post came out of spreadsheets I filled in at midnight. Autopilot tracks source, job value, close rate, and per-channel performance automatically, with a dashboard built for a truck business, not a SaaS company. Start a free trial or look at pricing, and next month your P&L can be a report you read instead of a project you dread.