This is the metric that comes in handy when you want to find out how many customers your business retains and at what value. To find out your churn rate, divide the number of customers you lose within a specific timeframe to the total number you had at the beginning of that period.
A churn rate refers to the metric that measures how many customers your company retains, and what the value of those customers are. To calculate churn rate you take the number of customers that you lost during a certain period, and divide that by the total number of customers that you had at the beginning of that period.
For example, if at the beginning of December you had 500 customers, and by the end of December, you have 400 customers, that churn rate can be calculated by the following: (500-400)/500 = 20%. That’s really high! The lower the churn rate for your company is, the better! If your company is a recurring revenue company, having a low churn rate is crucial.