The honest answer to what share of a customer base should be dormant: it depends on the threshold, which depends on each customer's own order cadence; on the desk's normal, from weekly foodservice to annual capital equipment; and on the value in the dormant accounts rather than the count. This page gives the arithmetic that sets the threshold, the ranges seen by desk, and the table to compute before anyone quotes a percentage.
The question is usually asked as a count: how many of our accounts are dormant, and is that too many? The answer starts with what dormant means, and ends with what the dormant accounts used to buy.
With a per-account threshold, the share of accounts dormant at any time runs roughly:
| Desk | Cadence | Dormant share of accounts, typical |
|---|---|---|
| Foodservice distribution | Weekly | 5 to 12 percent |
| Builders' merchant | Weekly to monthly | 10 to 20 percent |
| Industrial distribution | Monthly | 12 to 25 percent |
| Wholesale and CPG to independents | Monthly | 10 to 20 percent |
| Professional services | Project-based | 20 to 35 percent |
| Capital equipment and aftermarket | Annual and longer | 25 to 40 percent |
The dormancy by industry hub covers each. The wide spread is the point: a fixed threshold produces a number that means nothing across desks and little within one.
Threshold = k × the account's typical gap between orders, with k stated, usually 2 or 3
| Account | Orders in 24 months | Typical gap | k = 2.5 threshold | Days since last order | Dormant? |
|---|---|---|---|---|---|
| A | 96 | 7 days | 18 days | 41 | Yes |
| B | 4 | 180 days | 450 days | 200 | No |
| C | 24 | 30 days | 75 days | 60 | No |
A fixed 90-day rule would list none of them. The per-account rule lists A, which has missed five weekly orders. The worked example on ten accounts computes the thresholds by hand.
Dormancy rate by count = dormant accounts ÷ active accounts in the prior year Dormancy rate by value = prior-year revenue of dormant accounts ÷ prior-year revenue of all
| Base | Accounts | Dormant | By count | Prior revenue dormant | By value |
|---|---|---|---|---|---|
| Branch 1 | 800 | 120 | 15% | $90,000 of $6,000,000 | 1.5% |
| Branch 2 | 800 | 120 | 15% | $1,200,000 of $6,000,000 | 20% |
Same count. One is a tail resting; the other has lost a fifth of its base's revenue without a churn figure moving.
The same rate, computed the same way, twelve months ago and at each month between. A rate of 18 percent steady for three years is the desk's normal. A rate of 18 percent up from 11 in a year is the finding, whatever the industry table says.
| Measure | Formula | From |
|---|---|---|
| Threshold per account | k × typical gap | Order dates |
| Dormant flag | Days since last order > threshold | Order dates |
| Rate by count | Dormant ÷ prior-year active | Above |
| Rate by value | Prior-year revenue of dormant ÷ prior-year revenue | Ledger |
| Same, twelve months ago | Same, on the prior year's data | Ledger |
| Dormant list ranked by prior value | Dormant accounts, prior revenue, days over threshold, owner | Ledger and CRM |
Fixed threshold. Ninety days lists the annual buyers and misses the weekly ones.
Count without value. Fifteen percent, and no one asks what they bought.
Compared to the industry, not to itself. A base at its own normal panicked by a benchmark; a base doubling its rate reassured by one.
Dormancy called churn. The account is written off while it can still be called.
A good dormancy rate is one computed with a per-account threshold, stable or falling against the base's own history, and small by prior value even when it is not small by count. The count on most B2B desks sits between 10 and 25 percent; the value figure is the one that decides whether anyone should be worried. Covirage computes the threshold per account from the order dates, the rate both ways, the trend, and the ranked list every week.
Each account's own. Take the account's gaps between orders over the last two years, find the typical gap, and set the threshold at a multiple of it, two or three times. A fixed ninety days is wrong on both ends: it lists annual buyers who are fine and misses weekly buyers who are gone.
No. Churn is a customer who has ended; dormancy is a customer who has stopped ordering past their own norm and has not been asked why. Dormancy is earlier and recoverable. Most churn spent months as dormancy first, and the dormancy list is the list to work before the churn figure moves.
A rate rising against its own history, or a rate whose dormant accounts held a large share of last year's revenue. Fifteen percent of accounts holding 3 percent of prior revenue is a long tail resting; 15 percent holding 20 percent is a problem. Count and value, side by side.