Calculate the maximum sustainable customer base your business can maintain based on acquisition and churn rates.
The Stable Customer Base (or equilibrium point) is the maximum number of customers your business can maintain with your current acquisition and churn rates. At this point, the number of new customers you gain equals the number of existing customers you lose.
Formula:
Max Sustainable Customers = New Customers per Month / Monthly Churn Rate
(Where churn rate is expressed as a decimal, e.g., 5% = 0.05)
Why this metric matters:
How to interpret:
Note: This model assumes consistent acquisition and churn rates. In reality, these factors may vary over time due to seasonality, competitive landscape changes, and other market dynamics.
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