Saved Cancellations Ratio

What it means:

The Saved Cancellations Ratio is the KPI equivalent to Sales Success but related to cancellations. It measures the effectiveness of the cancellation management or retention process.

This ratio provides insight into whether our cancellation management process and the tools and solutions for saving cancellations are successfully retaining some members, even if temporarily, who request to cancel their club membership.

How it's calculated:

Currently, few clubs measure this KPI, despite its significant value in understanding our ability to reverse cancellation requests.

It is calculated by dividing the total number of saved cancellations in a month by the total number of cancellation requests and multiplying by 100 to convert it to a percentage.

For accurate measurement, it is necessary to reliably record all cancellation requests. Many clubs require that cancellations be managed in person at the club. Thus, the cancellation process includes those handled in person, where efforts are made to understand the reasons for the cancellation and seek solutions where possible.

Cancellations forced by the club due to returned payments, which would be part of a different KPI for unpaid fees, and cancellations made via email or other non-personal formats would not be included in this ratio. These should be measured separately.

Benchmark Values:

There are few references for this KPI in the sector since few clubs measure it. Based on our experience and data managed by FitnessKPI software, values above 20% of saved cancellations are considered good.

This means that the club is capable of extending the membership life of 20% of its clients, even if only temporarily, gaining 1 or 2 months to implement solutions that improve the client’s satisfaction or connection with the club.

How to improve:

To improve this ratio, the customer service team needs to be well-trained in handling cancellations. This is one of the most complex and usually unpleasant processes to manage but has a significant impact on the club’s total membership volume. Saving 25 members per month, for example, results in 300 members at the end of the year, representing a considerable amount of revenue depending on the club's fees.

Besides having staff trained in cancellation management, a range of potential solutions or alternatives to cancellation should be available to offer the client at that moment. Often, these solutions are personalized to the client's situation, so the customer service staff should have some discretion to apply one solution or another depending on the client. For example, one client might be scheduled for a consultation with a trainer, while another might receive a free personal training session, an introduction to paddle tennis, or a swimming course.

Analyzing this ratio over several months allows us to see if our results are stable or if we are inconsistent. This can prompt us to seek improvements by analyzing who manages each cancellation since there might be someone on the team who excels at this task while others may not. It also helps identify if we applied a particular solution or alternative in a specific month that worked exceptionally well and prevented more cancellations.

Managing cancellations is a delicate moment and the last opportunity to retain a client before they leave the club. Proper handling is crucial for reducing cancellations and, if a cancellation cannot be avoided, to correctly say goodbye to the client, leave the door open for their return, and attempt to find someone to take their place, maintaining continuity in membership.

Pablo Viñaspre
CEO & Co-Founder FitnessKPI