How To Calculate CAC in SYSPRO | Arithmix

Calculating customer acquisition cost (CAC) is an important step in understanding the effectiveness of your marketing and sales efforts. In this article, we'll explore what CAC is, when it's valuable to calculate it, and how to calculate it in SYSPRO.

What Is CAC?

CAC is the cost of acquiring a new customer. This includes all the expenses associated with marketing and sales efforts, such as advertising, events, salaries, commissions, and software tools. By calculating CAC, you can determine how much you're spending to acquire each customer and compare it to the revenue generated by that customer.

For example, if your CAC is $100 and your average customer generates $500 in revenue, you have a 5:1 ratio of revenue to CAC. This means that for every $1 you spend on acquiring a customer, you generate $5 in revenue.

When Is It Valuable To Calculate CAC?

Calculating CAC is valuable in several situations:

• When you're launching a new product or service and want to estimate the cost of acquiring customers
• When you're evaluating the effectiveness of your marketing and sales campaigns
• When you're comparing the cost of acquiring customers across different channels or regions
• When you're trying to optimize your marketing and sales budget and want to focus on the channels or campaigns that generate the highest revenue to CAC ratio

How To Calculate CAC In SYSPRO

Calculating CAC in SYSPRO requires several steps:

1. Identify the expenses associated with acquiring customers, such as advertising, events, salaries, commissions, and software tools
2. Allocate these expenses to the relevant sales orders or invoices in SYSPRO
3. Calculate the total expenses for a given period, such as a month or a quarter
4. Divide the total expenses by the number of new customers acquired in the same period
5. The result is your CAC for that period

For example, let's say you spent $10,000 on marketing and sales expenses in January and acquired 100 new customers in the same month. Your CAC for January is $100.

It's important to note that CAC may vary over time and across different channels or regions. Therefore, it's recommended to calculate CAC regularly and track it over time to identify trends and opportunities for improvement.

In conclusion, calculating CAC is a valuable exercise for any business that wants to optimize its marketing and sales efforts. By understanding the cost of acquiring customers and comparing it to the revenue generated by those customers, you can make informed decisions about where to allocate your resources and focus your efforts.

How Do You Calculate CAC in SYSPRO

SYSPRO 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 SYSPRO 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 SYSPRO, 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 SYSPRO 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 SYSPRO 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.