Business Formulas

Key indicators and formulas related to Business Formulas

91 metrics

Customer Life Cycle & Value

Core quantitative metrics tracking account longevity, active usage, acquisition volume, and retention economics.

Metric		Description
Active Customers		Count of unique accounts or buyers actively engaging or transacting within a defined timeframe
Customer Lifetime Length (CFL)		Average duration a customer maintains an active commercial relationship with a business
Customer Tenure		Length of time an individual customer account has remained continuously active
Number of New Customers		Total volume of first-time purchasing accounts acquired during a specific period
Products per Customer		Average quantity of distinct products or service modules utilized per active customer
Raw Customer Retention Rate		Percentage of existing customers retained over a given period, excluding new acquisitions
Customer Health Score (CHS)		Composite score evaluating usage patterns, satisfaction signals, and account churn risk
Customer Retention Cost (CRC)		Average cost incurred to support, engage, and retain an existing customer

Customer Satisfaction & Loyalty

Survey-based metrics and frameworks evaluating customer sentiment, effort, advocacy, and strategic positioning.

Metric		Description
Customer Effort Score (CES)		Measures customer effort required to resolve an issue or complete a specific interaction
Customer Loyalty Index		Composite index tracking repurchase likelihood, brand sentiment, and ongoing advocacy
Customer Satisfaction (CSAT)		Percentage of customers satisfied with a specific transaction, product, or support experience
Net Promoter Score (NPS)		Gauges long-term brand advocacy and likelihood of organic recommendations
Porter's Five Forces		Strategic framework evaluating competitive dynamics, buyer power, and market attractiveness

Growth & Virality

Key metrics and frameworks for evaluating expansion velocity, viral loops, business throughput, and product adoption.

Metric		Description
Checkout Completion Rate		Percentage of initiated checkout processes that successfully culminate in a completed transaction.
Compound Annual Growth Rate (CAGR)		Mean annual growth rate of a financial or operational metric over a period longer than one year.
Economic Value Added (EVA)		Financial metric assessing true economic profit generated beyond the company's cost of capital.
Enterprise Value (EV)		Comprehensive measure of a company's total valuation, reflecting debt, equity, and liquid cash.
Growth Rate		Percentage change of a given performance metric over a specific time interval.
Internal Growth Rate		Maximum growth rate achievable using retained earnings without acquiring external financing.
List Growth Rate		Net percentage rate at which a marketing email or customer contact database expands.
Market Value Added (MVA)		Difference between current market capitalization and total cumulative capital invested.
Page Value		Average revenue generated by a specific web page in driving goal conversions or transactions.
Revenue Growth		Percentage increase in total sales revenue earned over a designated financial period.
Self-Financeable Growth Rate (SFG)		Maximum sales expansion rate a business can sustain without straining working capital balances.
Sustainable Growth Rate		Maximum achievable growth rate without increasing equity dilution or changing financial leverage.
Time to First Value (TTFV)		Duration required for a newly onboarded user to experience their first tangible product value.
Viral Coefficient		Average number of new active users acquired by each existing user through referrals.
Viral Cycle Time		Total duration required for an existing user to invite a contact who then successfully onboard.
Feature Adoption Rate		Percentage of active platform users who actively utilize a specific feature.
First-Time User Experience Completion Rate (FTUE Completion Rate)		Proportion of newly registered users who complete the initial product onboarding setup.
Gross Merchandise Value (GMV)		Total cumulative dollar volume of goods sold through a platform or marketplace over a given period.
Net Asset Value (NAV)		Net monetary value of an entity's assets minus liabilities, calculated on a per-share basis.
Net Merchandise Value (NMV)		Total volume of marketplace transactions processed after deducting returns, cancellations, and discounts.
Time to Value (TTV)		Total timeframe required for a customer to realize expected value post-purchase.
Value Chain Analysis		Strategic framework evaluating primary and support activities that build competitive advantage.
Viral Expansion Index		Composite metric measuring downstream referral compounding across multi-tier user networks.

User Engagement

Essential performance indicators evaluating active user engagement, product stickiness, and interactive responsiveness.

Metric		Description
Daily Active Users (DAU)		Total number of unique users who perform a meaningful action within a platform in a single day.
Monthly Active Users (MAU)		Total number of unique users who engage with a platform within a 30-day period.
Percent of Active Users		Proportion of total registered user accounts that remain actively engaged over a specified period.
Time to Interactive (TTI)		Web performance metric measuring time elapsed until a page becomes fully responsive to user input.

Inventory & Supply Chain

Core quantitative metrics for monitoring stock levels, warehouse fulfillment, transportation efficiency, and inventory throughput.

Metric		Description
Backorder Rate		Percentage of customer orders that cannot be fulfilled immediately at purchase due to stockouts
Carrying Cost of Inventory		Total cost associated with storing, holding, and maintaining unsold inventory over a specific period
Economic Order Quantity (EOQ)		Ideal order quantity that minimizes the total combined costs of inventory ordering and holding
Fill Rate		Percentage of customer order demand fulfilled immediately from current inventory without stockouts
Freight Cost per Unit		Average shipping and transportation cost incurred for each unit of product moved
On-Time In-Full (OTIF)		Percentage of customer orders delivered strictly on schedule and with complete ordered quantities
Perfect Order Rate		Percentage of orders completed without errors in entry, documentation, damage, or delivery timing
Reorder Point (ROP)		Minimum inventory level that automatically triggers a new procurement purchase order
Safety Stock (SS)		Buffer inventory maintained to protect against unforeseen demand surges or supply chain delays
Days Sales in Inventory (DSI)		Average number of days a company takes to convert its inventory into sales
Days Inventory Outstanding (DIO)		Working capital ratio measuring the average number of days capital remains tied up in inventory
Dock-to-Stock Time		Total time required to process incoming shipments from arrival at the receiving dock to placement in warehouse storage
On-Time Delivery Rate (OTD)		Percentage of orders delivered to customers on or before the promised delivery date
Stockout Rate		Percentage of customer demand or order requests that cannot be fulfilled due to missing inventory

Production & Capacity

Operational indicators used to optimize factory throughput, equipment balance, material scrap, and facility space.

Metric		Description
Capacity Utilization Rate		Percentage of maximum potential production output that is actively achieved
Overall Equipment Effectiveness (OEE)		Comprehensive manufacturing standard measuring equipment productivity across Availability, Performance, and Quality
Takt Time		Rate at which products must be produced to match the exact pace of customer demand
Work in Progress (WIP)		Quantity of partially completed products currently undergoing assembly within the production pipeline
Scrap Rate		Percentage of raw materials or produced units discarded due to defects during manufacturing
Warehouse Capacity Utilization		Proportion of usable warehouse volume or bin positions currently occupied by stored inventory
Dividend Yield (DY)		Financial investment metric calculating annual dividend payouts relative to market share price
Yield Rate		Proportion of non-defective, usable products produced out of total raw units entering the process

Maintenance & Quality

Key framework metrics for monitoring defect-free manufacturing, fulfillment cost structures, order economics, and process flow.

Metric		Description
First Pass Yield (FPY)		Percentage of products completed correctly on the initial attempt without requiring rework or adjustment
Order Fulfillment Cycle Time		Total elapsed time from customer order placement to final delivery completion
Average Order Value (AOV)		Average monetary value spent by customers per single placed order
Cost Per Order (CPO)		Average total operational and fulfillment cost spent to process and ship a single order
Minimum Order Quantity (MOQ)		Lowest number of units or inventory dollar value a supplier mandates per single order
Process Cycle Efficiency (PCE)		Ratio of active value-adding processing time relative to total overall lead time elapsed
Total Effective Equipment Performance (TEEP)		Comprehensive asset utilization metric evaluating operational performance against total continuous calendar time

Recruiting & Hiring

Essential metrics for evaluating talent acquisition velocity, hiring investments, and candidate quality.

Metric		Description
Cost per Hire (CPH)		Average total investment required to acquire and onboard a new employee
Time to Hire		Total days elapsed from when a candidate enters the hiring pipeline until offer acceptance
Quality of Hire (QoH)		Composite metric measuring post-hire success, performance output, and organizational value of new hires

Workforce Value & Cost

Key parameters measuring employee satisfaction, productivity yield, and overall labor effectiveness.

Metric		Description
Employee Net Promoter Score (eNPS)		Metric measuring employee loyalty, workplace sentiment, and willingness to recommend the company
Overall Labor Effectiveness (OLE)		Comprehensive operational metric assessing workforce productivity through availability, performance rate, and output quality
Revenue per Employee (RPE)		Efficiency ratio measuring the average top-line revenue generated per full-time employee
Employee Engagement Index (EEI)		Composite index reflecting workforce commitment, discretionary effort, and emotional alignment with business goals
Internal Mobility Rate		Percentage of open roles or career growth opportunities filled by internal talent promotions and transfers

Retention & Turnover

Analytical tools for evaluating workforce stability, employee retention trends, and turnover impact.

Metric		Description
Employee Retention Rate		Percentage of existing employees retained by the organization over a defined timeframe
Employee Turnover Rate		Percentage of overall employees leaving the organization across a given time period
Voluntary Turnover Rate		Percentage of employees who resign or leave the organization by their own choice
Asset Turnover Time Ratio (ATOT)		Financial efficiency metric measuring the average days required to turn total capital assets into revenue
Fixed Assets Turnover		Efficiency ratio evaluating revenue generated relative to investment in fixed workplace assets
Inventory Turnover Ratio (ITO)		Operational ratio measuring how frequently inventory stock is sold and replenished over a period
Payable Turnover Ratio (PTO)		Liquidity metric evaluating the velocity at which an organization pays off vendor credit obligations
Receivables Turnover Ratio (RTO)		Efficiency metric measuring how effectively client receivables and outstanding credits are collected
Total Asset Turnover (ATO)		Macro operational ratio evaluating top-line revenue generated per dollar of total assets owned
Turnover		General baseline metric tracking total employee departures within a defined evaluation window
Employee Churn Rate		Operational turnover metric evaluating short-term workforce loss within specific business units or projects
Inventory Turnover Time Ratio (ITOT)		Operational ratio measuring average days required to sell through complete inventory holdings
Payable Turnover Time Ratio (PTOT)		Metric measuring average payment cycle duration to trade vendors in days
Receivable Turnover Time Ratio (RTOT)		Average timeframe in days required to collect outstanding client credit balances

Build a Lean Business System with Small Business OS

Your complete Notion operating system to manage projects, clients, finances, and objectives in one place.

Explore Template