Attrition Analysis and Customer-Relationship Life Expectancy
American Society of Appraisers
Business Valuation Review™
Volume 24, Issue 4
Richard K. Ellsworth, PE, ASA
The estimation of life expectancy is a fundamental element associated with the valuation of customer relationship intangible assets. In many instances, a simple method is desired to estimate the life characteristics of a customer population. Attrition analysis provides a simple method to establish survivor behavior for a customer population and life expectancy from consideration of the customer population attrition rate.
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