Calculating your retention rate is straightforward once you know the Customer Retention Rate formula and what each input means. This guide explains the method in plain language, walks through a manual calculation, and gives worked examples you can follow — then you can do it instantly with the Customer Retention Rate Calculator.
What is Customer Retention Rate?
The Customer Retention Rate calculation tells you your retention rate from a few simple inputs. The figure you are solving for here is the retention rate, expressed in percent.
The Customer Retention Rate formula
The core formula is:
Retention rate = (Customers at end - New customers gained) ÷ Customers at start × 100Here is what each input means:
- Customers at start — a number. Example: 200.
- Customers at end — a number. Example: 220.
- New customers gained — a number. Example: 40.
How to calculate it step by step
- Write down the customers at start (for example, 200).
- Write down the customers at end (for example, 220).
- Write down the new customers gained (for example, 40).
- Apply the formula above to get your retention rate.
- Double-check the result with the Customer Retention Rate Calculator.
Worked examples
Example 1
| Input / Output | Value |
|---|---|
| Customers at start | 200 |
| Customers at end | 220 |
| New customers gained | 40 |
| Retention rate | 90.00% |
With customers at start of 200, customers at end of 220 and new customers gained of 40, the retention rate works out to 90.00%.
Example 2
With customers at start of 400, customers at end of 220 and new customers gained of 40, the retention rate works out to 45.00%.
| Result | Value |
|---|---|
| Retention rate | 45.00% |
Example 3
With customers at start of 100, customers at end of 220 and new customers gained of 40, the retention rate works out to 180.00%.
| Result | Value |
|---|---|
| Retention rate | 180.00% |
Tips for an accurate result
- Keep your units consistent — mixing, say, months with years or grams with kilograms is the most common source of error.
- Round only at the very end. Rounding inputs early can shift the final answer noticeably.
- Re-run the numbers whenever an input changes, rather than estimating from an old result.
Prefer not to do the maths by hand? — the Customer Retention Rate Calculator does it instantly, for free, with the formula and a worked example built in.
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