Question

For the grocery store the number of existing customers retained for each year is given below. What is the churn in 2015 taking 2012 as the base year? Year 2011 2012 2013 2014 2015 No. of existing customers retained 260 250 230 225 225 (In thousands') O10 % 0 % 8 % O 225 %

Answer 1

Churn rate is a percentage of customers leave the stock at given period of time.

No. of existing customer retained in 2012 = 250

No. of existing customer retained in 2015 = 225

$\textup{Churn rate }= \frac{\textup{Customer in 2012 -Customer in 2015}}{\textup{Customer in 2012}}$

$\textup{Churn rate }= \frac{(250-225)}{250}$

$\textup{Churn rate }= \frac{(25)}{250}$

$\textup{Churn rate }= 0.1$

$\bg_green \large \textup{Churn rate }= 10\%$

Hope this will help, please do comment if you need any further explanation. Your feedback would be highly appreciated.