Hi there,
Thanks for reaching out! It's a really common question, wondering whether you can get a better deal by looking overseas for an agency. I'm happy to give you some of my initial thoughts from here in the UK.
To be blunt, I think you might be focusing on the wrong metric. The difference in hourly rates is a distraction from what actually matters: getting a return on your investment. A cheap agency that burns your cash is infinitely more expensive than a pricier one that actually grows your business. Let's get into what you should really be looking for.
TLDR;
- Stop comparing agency prices based on hourly rates or location; it's a false economy. The only thing that matters is their ability to deliver a profitable return on your ad spend.
- Your number one priority should be vetting an agency for deep, provable expertise in advertising for local service businesses like yours. Look for specific case studies.
- With a $2k/month total budget, every single dollar counts. Most of that budget needs to go on ad spend, not fees, so you need an agency that is ruthlessly efficient.
- Before you spend a penny on ads, you need to understand your numbers. Use the interactive calculator in this letter to figure out the maximum you can afford to pay for a single lead.
- The best channel for a service business is almost always Google Ads, targeting people actively searching for what you do. Forget social media for now.
You're asking the wrong question... it's not about cost, it's about value
I see business owners make this mistake all the time. You've looked at agency prices in the US, seen they average around $150/hr, then seen UK agencies at a fraction of that and thought, "great, I can get 3x the work for the same money". I get the logic, but it's flawed from the start. You're not buying 'hours' of marketing work. You're buying results. Or at least, you should be.
Let's play this out. Agency A (UK) costs $500/month. Agency B (US) costs $1500/month. You have a total budget of $2k. With Agency A, you have $1500 left for actual ad spend. With Agency B, you have $500. It seems like a no-brainer, right? More money for ads must be better.
But what if Agency A, the cheaper one, lacks the specific expertise for the US market or for your trade? What if they set up broad campaigns that attract tyre-kickers and waste that $1500, bringing you maybe two low-quality leads? You've spent $2000 and have nothing to show for it. Your total return is negative $2000.
Now, what if Agency B, the expensive one, has a proven track record with US service companies? They know exactly which keywords to target, how to write ad copy that speaks to your customers, and how to build a landing page that converts. With their expertise, that smaller $500 ad spend generates ten high-quality leads, and you close three of them into jobs worth $5000. You've spent $2000 and made $5000. That's a result.
The agency fee is irrelevant if the campaign is profitable. The cheaper agency cost you everything; the expensive one made you money. This is the only way you should be thinking about it. Price is a terrible indicator of an agency's worth. Expertise is the only thing that matters, especially on a tight budget where there's no room for error.
I'd say you need to become an expert at hiring experts
So, forget geography for a moment. Whether the agency is in London, Los Angeles, or Lisbon is the last thing you should care about. Time zones can be managed. Cultural nuances for a local US service business are pretty straightforward for any competent marketer to research. What you can't fake is a deep, battle-tested understanding of paid advertising for businesses like yours. So how do you find that?
-> Look at their case studies. And I mean *really* look. Don't just read the headline "We got 500 leads for a client". Demand specifics. What kind of business was it? A roofer in Texas has a very different advertising landscape to an accountant in New York. Was it a service business at all? What was the cost per lead? What was the client's return on ad spend? If they don't have detailed case studies for businesses that look and feel like yours, that's a massive red flag. For example, in one of our campaigns for a home cleaning company, we achieved a cost of just £5 per lead. We're also currently running a campaign for an HVAC company in a competitive area, and they are seeing costs of around $60/lead. That's the level of detail you need.
-> Get on a call and grill them. A good agency will offer a free initial consultation or an account review. This is your interview. Don't let them just give you a sales pitch. Ask them hard questions. "Given my $2k budget, how would you split that between your fee and ad spend? What CPL should I expect in my city for my service? Which platform would you start with and why? What's the first thing you'd fix on my website?" Their answers will tell you everything. If they're vague, promise the world, or can't give you specific, data-backed answers, they don't have the expertise you need. They should be honest, even if it's not what you want to hear. For example, they should tell you that $2k is a very tight starting budget and that success will depend on ruthless efficiency.
-> Check their reviews. Look for reviews from other business owners. What do they say about communication? About results? About strategy? A string of five-star reviews without any substance is less valuable than a handful of detailed reviews that talk about the actual business impact the agency had.
Honestly, if an agency has shown you solid case studies, and you've had a great strategy call where they've given you real, actionable advice, you should have a good feel for their competence. If you still feel the need to ask for references to call their other clients, it's probably not a good fit. It signals a lack of trust that will likely poison the relationship from day one. Your job is to do the research upfront to build that trust in your own judgement.
You probably should understand your numbers first
Before you even speak to an agency, you need to know the single most important number in your business: what is a lead worth to you? Without this, you're flying blind. You have no way to judge if an agency's performance is good or bad. An agency might report a $70 Cost Per Lead (CPL) and you might think that's expensive. But if one in five of those leads turns into a $2,000 job, you're paying $350 to make $2,000. That's a fantastic return. You'd be foolish not to want more of those leads.
Conversely, a $10 CPL sounds amazing. But if the leads are junk and none of them convert, you've just wasted your money. It all comes down to the maths.
You need to calculate your maximum affordable CPL. This is the highest price you can pay for a lead and still break even on your marketing spend. Any CPL below this number means you are profitable. This number becomes your North Star for any advertising campaign. I've built a simple calculator for you below to figure this out. Play around with the numbers and see how they affect what you can afford to pay.
You'll need a simple, effective lead generation machine
For a local service business, the strategy should be brutally simple and effective. You don't need fancy social media campaigns or complex SEO strategies to begin with. You need leads, now. That almost always means one thing: Google Ads.
Why? Because you're capturing intent. You're not trying to persuade someone they need an electrician; you're putting your business in front of someone who is actively typing "emergency electrician near me" into their phone at 2 AM. There is no better lead than that. This is where you should focus 100% of your initial advertising budget.
The entire process should look like a well-oiled machine, and it's an agency's job to build and maintain it. But you need to understand the parts so you know what good looks like.
Your website is the most common point of failure. You can have the best ads in the world, but if they send people to a slow, confusing, untrustworthy website, you will get zero leads. Your website must be your best salesperson. A good agency will be brutally honest about this and may even insist on building you a dedicated landing page before they'll run any ads. A bad agency will just take your money, run the ads, and then blame the poor results on 'the market'.
This is the main advice I have for you:
Here's a summary of my recommendations, laid out as a clear plan of action. This is the thought process you should follow when making your decision.
| Step | Action | Why It Matters |
|---|---|---|
| 1. Know Your Numbers | Use the calculator above to determine your Average Profit Per Job and your Maximum Affordable Cost Per Lead (CPL). | This is your benchmark for success. Without it, you cannot possibly judge if your advertising is working or not. It removes guesswork and emotion. |
| 2. Prioritise Expertise Over Price | Shortlist 3-5 agencies (regardless of location) that have strong, detailed case studies for other local US service businesses. | Proven experience is the single greatest predictor of future success. An agency that's already solved your problems for someone else is worth paying for. |
| 3. Conduct Expert Interviews | Book intro calls with your shortlist. Ask them for a specific strategy for your business on your budget. Ask for expected CPLs. Listen for confidence backed by data, not vague promises. | This separates the true experts from the salespeople. You'll quickly discover who understands the realities of your business and who is just trying to close a deal. |
| 4. Insist on a Website/Landing Page Review | Ask each agency for their honest opinion of your current website's ability to convert paid traffic into leads. | An expert agency knows that sending traffic to a poor website is malpractice. Their willingness to have this tough conversation is a sign of a true partner. |
| 5. Make a Value-Based Decision | Choose the agency that you are most confident can deliver leads below your Maximum Affordable CPL, even if they aren't the cheapest option. | The goal isn't to save money on a fee; it's to make money from an investment. Pay for the expertise that will generate that return. |
So, is hiring a UK agency wise? It can be, but not because they're cheaper. It's wise if they happen to be the most qualified, most experienced, and most impressive agency you speak to. If that agency is in the UK and their pricing is favorable, consider it a bonus. But don't let it be the reason you hire them. The right partner will pay for themselves many times over, wherever in the world they happen to be.
Working with an expert partner is particularly important when you're starting with a smaller budget like yours. There's no fat to trim, no room for "learning on the job". Every pound, or dollar, has to be put to work effectively from day one. An experienced hand can navigate the setup and optimisation process far more quickly and efficiently, saving you from costly mistakes and getting you to profitability faster.
We specialise in exactly this – building and managing high-performance paid advertising campaigns for businesses. If you'd like to have a more detailed chat about your specific situation, we offer a free, no-obligation consultation where we can analyse your business and give you a clear, honest assessment of what we think is possible.
Hope that helps!
Regards,
Team @ Lukas Holschuh
