The True Cost of Client Churn

February 25, 2020 The True Cost of Client Churn

By Captain's Chair

Your clients are your MSP business’s most valuable assets, and lost clients can impact your business in a big way. If you’re not tracking these critical client-related metrics, there’s no better time to start:


  • Lifetime Value of a Client: This value can be calculated by averaging the number of months that you have a client and multiplying that number by their MRR (monthly recurring revenue).
  • Client Acquisition Cost: You can establish this value by examining the current cost of your sales and marketing teams and any campaigns designed to drive new business. Take these costs and divide the total by the number of clients that have been acquired in a given timeframe.
  • Client Churn Rates: This value can be defined as the loss of clients or reduction of services over a given period of time.


High churn rates reduce customer ‘lifetime value’; even worse, they drive up the cost of customer acquisition due to the need to replace lost customers. The result is less profit for your business and a negative impact on your bottom line.


As an MSP, what can you do to reduce churn rates?


  • Make your value visible
  • Improve client experience
  • Track client satisfaction


At Captain’s Chair, we’re working to make these areas of improvement as seamless as possible for our MSP partners. The Captain’s Chair platform provides clients with two of the most important factors in a successful ongoing relationship with your business: transparency and communication. When you keep the lines of communication open with your clients and provide the visibility and transparency they need to feel informed, you’ll stand out in the competitive MSP market. Put your clients in the Captain’s Chair to reduce your churn rates and help them achieve their digital transformation.