How To Calculate CAC in Epicor | Arithmix

Calculating CAC (Customer Acquisition Cost) is an important metric for any business, as it helps to determine how much it costs to acquire a new customer. This can be especially valuable for businesses that are looking to grow and expand their customer base. In this article, we will explore what CAC is, when it is valuable to calculate, and how to calculate it in Epicor.

What Is CAC?

CAC is the cost of acquiring a new customer. This includes all the marketing and sales expenses that are incurred in order to attract and convert a new customer. These expenses can include things like advertising, sales commissions, and marketing materials. By calculating CAC, businesses can determine how much they are spending to acquire each new customer, and whether or not that cost is sustainable.

For example, if a business spends $10,000 on marketing and sales efforts in a given month, and acquires 100 new customers during that time, the CAC would be $100. This means that it costs the business $100 to acquire each new customer.

When Is It Valuable To Calculate CAC?

Calculating CAC can be valuable for businesses in a number of different situations. For example, if a business is looking to expand its customer base, it may want to calculate CAC in order to determine how much it will cost to acquire new customers. This can help the business to set realistic goals and budgets for its marketing and sales efforts.

Similarly, if a business is experiencing a high churn rate (i.e. losing customers at a high rate), it may want to calculate CAC in order to determine whether or not it is sustainable to continue acquiring new customers at the same rate. If the CAC is higher than the lifetime value of a customer, it may be more cost-effective to focus on retaining existing customers rather than acquiring new ones.

How to Calculate CAC in Epicor

Calculating CAC in Epicor is relatively straightforward. First, you will need to gather data on all the marketing and sales expenses that were incurred during a given period (e.g. a month). This can include things like advertising costs, sales commissions, and marketing materials.

Next, you will need to determine how many new customers were acquired during that same period. This can be done by looking at your customer database and identifying the customers who made their first purchase during that time.

Once you have this data, you can divide the total marketing and sales expenses by the number of new customers to determine the CAC. For example, if you spent $10,000 on marketing and sales efforts in a given month, and acquired 100 new customers during that time, the CAC would be $100.

It is important to note that CAC can vary over time, depending on a number of different factors (e.g. changes in marketing strategy, changes in the competitive landscape, etc.). As such, it is important to regularly monitor and analyze CAC in order to ensure that it remains sustainable over the long term.

In conclusion, calculating CAC is an important metric for any business that is looking to grow and expand its customer base. By understanding what CAC is, when it is valuable to calculate, and how to calculate it in Epicor, businesses can make more informed decisions about their marketing and sales efforts, and ensure that they are acquiring new customers in a cost-effective manner.

How Do You Calculate CAC in Epicor

Epicor itself isn’t naturally geared towards letting you calculate complex metrics like CAC. As an alternative, teams typically use products like Arithmix to import data from Epicor and build out dashboards.

What is Arithmix?

Arithmix is the next generation spreadsheet - a collaborative, web-based platform for working with numbers that’s powerful yet easy to use. With Arithmix you can import data from systems like Epicor, combine it with data from other systems, and create calculations like CAC.

In Arithmix, data is organized into Tables and referenced by name, not by cell location like a spreadsheet, simplifying calculation creation. Data and calculations can be shared with others and re-used like building blocks, vastly streamlining analysis, model building, and reporting in a highly scalable and easy to maintain platform. Data can be edited, categorized (by dimensions) and freely pivoted. Calculations are automatically copied across a dimension - eliminating copy and paste of formulas.

Arithmix is fully collaborative, giving your entire team access to your numbers and the ability to work together seamlessly.

Calculating CAC in Arithmix

Calculating metrics like CAC is simple in Arithmix. Once you've created your free account, you’ll be able to import your Epicor data, and use it to create natural language formulas for metrics like CAC.

Arithmix is designed to give you the power to build any calculations you want on top of your Epicor data, while also being easy to use and collaborate on. You can share your dashboards with users inside and outside of your organisation, making it easy to empower your whole team.