What is the Churn Rate?
Sometimes referred to as the rate of attrition, a churn rate has to do with the current rate of net expansion associated with a financial or business factor. The principle of the churn rate can be applied to such diverse circumstances as the turnaround in a client base, or the rise and fall in the number of employees within a given firm. Generally, a churn rate calculation is employed to ensure that movement is occurring in the direction desired by the directing entity. In the case of the client base of a company, a churn rate will measure the growth or loss of active customers for the goods or services of the corporation. Companies that operate with a subscriber base find the calculation of the churn rate very helpful. Often, the churn rate can easily demonstrate changes that may be taking place by highlighting the decline of subscriber base participation, as well as growth of subscriber base in terms of a net gain of subscribers. When the churn rate indicates a downward slump in the
