Customer lifetime value (CLV)—It’s useful to
know how profitable a customer has been, but in some
cases the future potential profit levels, especially in
business-to-consumer (B2C) relationships, is more rele-
vant because customers go through life cycles.
Planning, budgeting, and rolling financial
forecasts—Based on forecasts of future demand vol-
ume and mix for types of services or products, com-
bined with assumptions of other proposed changes, how
much will it cost to match demand with our supplied
resources (for example, workforce staffing levels, pur-
chased materials)?
Capital expense justification—Is the return on
investment (ROI) of a proposed asset purchase, such as
equipment or an information system, justified?