What is a good monthly churn rate for SaaS?

World-class SaaS products have monthly churn below 1% (12% annual). Good is 2–3%/month. Average is 3–7%. Rates above 10%/month indicate serious product-market fit or retention issues. Consumer apps have higher tolerable churn than B2B.

What is the difference between customer churn and revenue churn?

Customer churn counts the percentage of customers lost. Revenue churn (or MRR churn) counts the percentage of MRR lost. If high-value customers churn, revenue churn can exceed customer churn. Expansion revenue (upsells) can result in negative net revenue churn.

How much does 1% monthly churn reduction save?

It depends on MRR and starting churn. For $100K MRR at 5% monthly churn, reducing to 4% saves approximately $150,000–$200,000 in cumulative revenue over 12 months due to the compounding effect.

What causes high churn?

Main drivers: poor onboarding (users never activate), poor product-market fit, lack of perceived value, pricing mismatch, better competitor alternatives, or involuntary churn (failed payments). Failed payments alone account for 20–40% of cancellations in most SaaS products.

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Free Churn Rate Calculator — SaaS Revenue Loss from Customer Churn

Churn rate is the percentage of customers who cancel their subscription in a given period. Even a seemingly small monthly churn of 5% compounds to a 46% annual customer loss. This calculator shows the MRR erosion and total revenue impact of your current churn rate over 12 months, and what improving churn by 1% saves.

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How It Works

How to use Churn Rate Impact Calculator

Enter starting MRR and customer count

Input your current monthly recurring revenue and number of active customers.

Set monthly churn rate

Enter your monthly churn rate as a percentage. Average SaaS churn is 3–7%/month.

See 12-month impact

The calculator shows MRR and customer count at each month, total revenue lost, and savings from 1% churn reduction.

FAQ

Frequently asked questions

Churn rate is the percentage of customers who cancel or do not renew their subscription in a given period. Monthly churn = customers lost / customers at start of month × 100. Annual churn = 1 - (1 - monthly churn)^12.

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References

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Free Churn Rate Calculator — SaaS Revenue Loss from Customer Churn

How to use Churn Rate Impact Calculator

Frequently asked questions

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