Subscription payback calculator: CAC and churn

Result

After a first order that keeps $3.79, renewals have to earn back $41.21. If every subscriber renewed that would take 4 renewals. With churn it takes 10 renewals, paid back in month 10.

First order

Revenue $32.00 to contribution margin $3.79 (11.8%)

Revenue

$32.00

Cost of goods

−$16.00

Pick and pack

−$1.18

Extra picks

−$0.20

Packaging

−$0.50

Shipping label

−$7.50

Card fee per order

−$0.30

Refunds

−$1.60

Card processing

−$0.93

Contribution margin

$3.79

1 declared kind costs nothing on this option

First order, margin per order: first order at $32.00, renewal at $36.00: revenue to contribution margin
Step	Grain	Amount
Revenue	–	$32.00
Cost of goods	per unit	−$16.00
Pick and pack	per order	−$1.18
Extra picks	per unit	−$0.20
Packaging	per parcel	−$0.50
Shipping label	per parcel	−$7.50
Card fee per order	per order	−$0.30
Refunds	percent	−$1.60
Card processing	percent	−$0.93
Contribution margin	–	$3.79
1 kind costing nothing	–	$0.00

Renewal

Revenue $36.00 to contribution margin $11.68 (32.4%)

Revenue

$36.00

Cost of goods

−$12.00

Pick and pack

−$1.18

Packaging

−$0.50

Shipping label

−$7.50

Card fee per order

−$0.30

Refunds

−$1.80

Card processing

−$1.04

Contribution margin

$11.68

2 declared kinds cost nothing on this option

Renewal, margin per order: first order at $32.00, renewal at $36.00: revenue to contribution margin
Step	Grain	Amount
Revenue	–	$36.00
Cost of goods	per unit	−$12.00
Pick and pack	per order	−$1.18
Packaging	per parcel	−$0.50
Shipping label	per parcel	−$7.50
Card fee per order	per order	−$0.30
Refunds	percent	−$1.80
Card processing	percent	−$1.04
Contribution margin	–	$11.68
2 kinds costing nothing	–	$0.00

Margin per order: first order at $32.00, renewal at $36.00
Per order	First order	Renewal
Revenue	$32.00	$36.00
Cost of goods	−$16.00	−$12.00
Pick and pack	−$1.18	−$1.18
Extra picks	−$0.20	$0.00
Packaging	−$0.50	−$0.50
Shipping label	−$7.50	−$7.50
Card fee per order	−$0.30	−$0.30
Refunds	−$1.60	−$1.80
Card processing	−$0.93	−$1.04
Contribution margin	$3.79	$11.68
Margin %	11.8%	32.4%

Renewals to break even if all stay: 4
With churn: 10
Expected renewals per subscriber, for life: 4.95
Profit per subscriber after CAC, over 24 months: $14.03

Expected profit per subscriber after CAC, month by month
Month	Still subscribed	Profit so far
0	100.0%	−$41.21
1	70.0%	−$33.03
2	55.3%	−$26.57
3	46.2%	−$21.18
4	39.6%	−$16.56
5	34.4%	−$12.54
6	30.1%	−$9.03
7	26.4%	−$5.94
8	23.2%	−$3.24
9	20.4%	−$0.86
10	17.9%	$1.24
11	15.8%	$3.08
12	13.9%	$4.70
13	12.2%	$6.13
14	10.7%	$7.38
15	9.5%	$8.49
16	8.3%	$9.46
17	7.3%	$10.32
18	6.4%	$11.07
19	5.7%	$11.73
20	5.0%	$12.31
21	4.4%	$12.83
22	3.9%	$13.28
23	3.4%	$13.68
24	3.0%	$14.03

First-order loss $41.21. Paid back month 10

Your numbers

The subscription

List price

First-order discount

Renewal discount

Welcome gift unit cost, first order only

Product unit cost

Shipping charged

Days between renewals

Acquisition and retention

Cost to acquire a subscriber

Ad spend divided by the subscribers it brought.

Subscribers who take the first renewal

Of subscribers who took an order, the share who take the next one, for the first renewal; later renewals move toward the settled rate, closing half the gap each time.

Settled renewal rate

The share of subscribers still with you who take each next renewal, once the early churn is over.

Months to follow

Fulfilment and payment

Pick and pack, per order

Each extra item picked

Box and packing, per parcel

Shipping label, per parcel

Card processing rate

Card fee per order

Refund reserve

The share of revenue you expect to refund.

Reset to the example

Computed with Offer Suite