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Client visitation and retention
How can I calculate client visitation and retention?
Q: In "Rev Up Your Revenue" (November 2005), the authors noted 12 critical components of revenue, including visitation and retention. How can I calculate these?
"Calculate your client visitation by dividing transactions by active clients," says Denise Tumblin, CPA, co-owner and vice president of Wutchiett Tumblin and Associates in Columbus, Ohio. "For instance, if you have 3,200 medical transactions, 1,900 other transactions, and 1,100 active clients, you have a visitation of 2.9 times per year for medical reasons and 1.7 times per year for other reasons."
To calculate client retention, Tumblin says to divide active clients for a 12-month period by new clients for the same period. The average number of active clients per doctor at a Well-Managed Practice during a 12-month period is 1,100, according to The 2005 Well-Managed Practice Study, produced by Wutchiett Tumblin and Associates and Veterinary Economics. "So, for instance, if you have 1,100 active clients and 20 new clients per month for a total of 240 new clients per year, your retention is 4.6 years: 1,100 active clients divided by 240 new clients," she says.