You're standing at the tailgate at the end of the day, trying to work out if last month's marketing spend actually made sense, and every answer you find online is a different percentage from a different industry. Here's the honest version: the most-cited number for a small business is 7-8% of revenue, it comes from an actual SBA-cited survey (not a number Ridge Solutions invented), and for a lot of one- and two-truck operations, a flat monthly cost still beats a percentage. Both things are true at once, and which one fits you depends on how big your revenue swings month to month.
Key takeaways
- The "SBA says 7-8%" line traces back to a 2018 industry survey (Web Strategies) that the SBA's own blog cites. It's a real figure from a real source, just not an SBA-authored law.
- The SBA's same blog post also cites a much lower figure, 1.08% of revenue, from a different survey of what small businesses actually spend. The range people actually operate in is wider than the popular "7-8%" line suggests.
- A percentage rule makes sense once your revenue is large and stable enough that 7-8% is still a number you can plan around month to month.
- For a smaller, seasonal, or newer operation, a flat, predictable cost is often the more honest fit, not because percentages are wrong, but because 7-8% of a number that swings $30,000 in a slow month isn't a budget, it's a guess.
Where the "7-8%" number actually comes from
Search "how much should I spend on marketing" and you'll see dozens of blogs state, flatly, that the SBA recommends 7-8% of revenue for businesses under $5 million. Almost none of them link to where that comes from. So we read the SBA's own blog post on marketing budgets directly.
Here's what it actually says: it cites a 2018 Web Strategies survey putting average marketing spend at 7.9% of revenue, and separately cites Small Business Trends data putting the more typical small-business ad spend around 1.08% of revenue. That's not a contradiction, it's two different surveys measuring different things (broader "marketing" spend versus narrower "advertising" spend), and the SBA's own post treats both as reference points, not a single fixed rule.
So the 7-8% figure is real. It's sourced. It just isn't an SBA rule handed down from on high, it's a cited survey number that's been repeated so many times across marketing blogs that it now gets attributed to the SBA itself, when the SBA post is really just quoting someone else's data. That distinction matters if you're about to size a real budget off it.
When a percentage rule actually makes sense
A percentage-of-revenue budget works best when your revenue is large enough and steady enough that the percentage translates into a real, plannable dollar number every month. If you're running a multi-crew operation with consistent monthly billing, 7-8% of revenue is a reasonable starting range to test against your own margins, same as the SBA post frames it.
It also assumes healthy margins to begin with. Spending 7-8% of revenue on marketing only works if what's left after materials, labor, and overhead can absorb it. A percentage rule applied to thin margins isn't a marketing budget, it's a way to lose money faster.
When a flat cost serves a smaller operator better
Here's the part most of the "spend X%" posts skip: for a solo or two-truck contractor, revenue isn't a smooth line, it's a stack of individual jobs that land unevenly. Say one month you close a $40,000 reno (a made-up example, not a real job); 7-8% of that is real money you can spend. The next month is slow, revenue drops, and the same percentage shrinks along with it, right when you actually need marketing to keep working.
A flat monthly cost doesn't have that problem, because it isn't tied to last month's number. That's the whole idea behind Ridge's own pricing: starting at $247/month CAD, the same fee whether last month was your best month or your worst. No percentage formula produced that number. It's predictable on purpose, because predictable is what a lot of small operators actually need.
Run the actual math on your own revenue
| Annual revenue | 7-8% of revenue (SBA-cited range) | Ridge Solutions, starting at $247/mo |
|---|---|---|
| $150,000 | $10,500-$12,000/yr | $2,964/yr (2.0% of revenue) |
| $300,000 | $21,000-$24,000/yr | $2,964/yr (1.0% of revenue) |
| $600,000 | $42,000-$48,000/yr | $2,964/yr (0.5% of revenue) |
Ridge's flat fee doesn't scale with revenue, so the gap between the two columns widens as revenue grows. That's the honest trade-off: a percentage rule flexes with a business's size; a flat fee doesn't, which is exactly why it suits a smaller, steadier budget better than a larger one.
This table uses round example revenue figures, not a real client's numbers. Run your own annual revenue through the 7-8% range and compare it to what you're actually spending (or considering spending) before deciding either way.
If you're weighing this against pay-per-lead platforms instead of a flat monthly fee, see how that spend compares and whether pay-per-lead ads are worth it either before locking in a number.
FAQ
Does the SBA actually require or recommend a specific marketing budget? No. The SBA's blog on marketing budgets cites other surveys' figures (7.9% from Web Strategies, 1.08% from Small Business Trends) as reference points, not a mandated rule. Treat 7-8% as a reasonable starting range to test, not a formula you owe anyone.
Is 7-8% too much for a small contracting business? It depends on your margins. The SBA's cited figure assumes roughly 10-12% profit margins. If your margins are thinner than that, spending the same percentage on marketing eats into money you need for materials, payroll, and slow months.
Why would Ridge Solutions recommend a flat fee instead of the SBA percentage? Because a percentage of a number that swings month to month isn't a stable budget for a smaller operator. That's the honest reason behind the flat pricing, not a claim that percentages are wrong for every business.
Should I spend more when business is slow? Often yes, since that's exactly when a percentage-based budget shrinks the most. A flat cost keeps the same spend running through a slow month instead of cutting marketing right when new jobs matter most.
If you'd rather have a predictable number
Everything above holds whether or not you ever talk to Ridge Solutions. If 7-8% of your revenue works out to a number you can plan around every month, that's a legitimate way to budget, and you don't need us for it. If your revenue is uneven and you'd rather know exactly what marketing costs every month regardless, the full price is public, no quote required: starting at $247/month CAD, no lock-in. Book a 20-minute call and I'll tell you honestly whether a flat fee or a percentage makes more sense for where your business actually is.
Sources
| Source | Claim it supports |
|---|---|
| SBA, "How to Get the Most From Your Marketing Budget" | Cites a 2018 Web Strategies survey (7.9% of revenue average marketing spend) and a Small Business Trends figure (1.08% of revenue typical ad spend). Fetched and confirmed directly; this is the actual source behind the widely-repeated "SBA says 7-8%" claim. |
| Ridge Solutions pricing | Starting at $247/mo CAD, no lock-in, verified against the live site. |
| Ridge Solutions, "Is Thumbtack Worth It for Contractors?" | Sibling post on pay-per-lead spend, linked for readers comparing marketing-spend models. |
Note on sourcing: The popular "the SBA recommends 7-8% of revenue" line, repeated across dozens of marketing blogs, was traced to its origin for this post. The SBA's own blog does not present 7-8% as an SBA-authored rule; it cites a 2018 Web Strategies survey average (7.9%) alongside a much lower Small Business Trends figure (1.08%) for actual small-business ad spend. Both are named and linked here rather than repeating the flattened, unsourced version of the claim.