Strategy & Tracking
Churn Rate
The rate at which customers stop buying from you — the leak that drains any contractor with recurring or maintenance revenue.
Definition
Churn Rate is the percentage of customers who stop doing business with you over a given period. It is the inverse of retention and a direct measure of how well you hold onto the customers you worked to win.
In depth
Churn Rate counts the customers you lost during a period and divides them by the customers you started with, then turns it into a percentage. Start a quarter with 100 maintenance clients, finish with 90 still active, and you churned 10 — a 10% quarterly churn rate.
Churn matters most for contractors with repeat or recurring revenue — annual service agreements, seasonal maintenance, gutter or HVAC plans. Every churned customer is one you have to replace with new, expensive acquisition just to stand still, so a few points of churn quietly raises your cost per acquisition and shrinks the customer lifetime value behind every relationship you fought to win.
The common mistake is tracking churn without asking why people leave — was it price, a missed callback, or a job that went sideways? We tag the reason in your CRM so churn becomes a list of fixable problems instead of a number, then feed the saved relationships back into your lead nurturing so they stay rather than slip away.
The formula
Churn Rate = Customers Lost ÷ Starting Customers × 100% Worked example
Your maintenance program starts the year with 200 homeowners and 30 cancel by year-end. Churn Rate = 30 ÷ 200 × 100% = 15%.
Strategy & Tracking
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