Sales & Customer Economics

Customer Cancellation / Churn Cost

Find out what losing a recurring customer actually costs: the future margin you lose plus what it costs to replace them.

Remaining contract yearsyearsAnnual direct margin$ / year, from Recurring Contract ValueReplacement acquisition cost$, from Customer Acquisition Cost

Total churn cost$2,020

Lost future value$1,520

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Next Decision

Based on your results, these related decisions are available.

Customer LTV : CAC RatioSee how this customer's value compares to what they cost to acquire and replace.

Methodology

Formula: lost future value = annual direct margin × remaining contract years. Total churn cost = lost future value + replacement acquisition cost.

Assumption: annual direct margin may be negative for a badly priced contract, in which case losing that customer can be a net savings once replacement cost is counted, a legitimate signal, not an error.

Limitation: this is a single-cancellation figure, not an annualized churn-rate model.