Customer lifetime value (CLV)

Customer lifetime value (CLV) is the sum of revenues a client will bring over the entire relationship: repeat jobs, maintenance contracts, referrals. It's computed simply: purchase frequency × average value × relationship length. Its role is to correct accounting myopia: a plumber who prices a missed call at "one $180 repair" almost always understates reality — a loyal local client is often several jobs a year for years, plus the neighbors they'll recommend.

It's the right unit for phone-reception decisions. Comparing the cost of a tool (a few dozen dollars a month) to the average ticket of one job is bad math; comparing it to the lifetime value of the clients it protects is the right way. Even with cautious assumptions — three missed calls a week, a modest recovery rate, an honest average lifetime value — the result almost always exceeds the tool's price. The question isn't "what does the solution cost?" but "what does each month without it cost?"