> ## Documentation Index > Fetch the complete documentation index at: https://docs.beaconrevenue.io/llms.txt > Use this file to discover all available pages before exploring further. # Cost to serve > What an account costs to serve as a share of its recurring revenue, the five cost categories behind it, and how to read it against its segment. ## What it is `cost_to_serve` is what an account costs to serve over the trailing twelve months, expressed as a share of the recurring revenue it produced over the same period. A higher number means a more expensive account. Alongside it Beacon publishes `cost_to_serve_amount` — the same cost as a currency figure — and the dominant cost driver behind it. ## How it is calculated Measured. Attributed cost over the trailing twelve months, divided by recurring revenue over the trailing twelve months. Five categories make up attributed cost. | Category | What it counts | | --------------------- | ------------------------------------------------------------------------------------------------------------------------------------------- | | Support | Ticket volume per active user, severity mix, escalation rate, time to resolution against your service levels | | Professional services | Hours consumed against hours contracted, scope amendments, the billable and non-billable split | | Customer-success time | Hours logged against the account, meeting count and duration, touchpoint frequency, escalation frequency | | Self-service | Knowledge-base and in-product help use, community participation, self-resolution rate. The one category where more activity lowers the cost | | Infrastructure | Compute, storage and bandwidth allocated to the account, custom-integration overhead, account-specific third-party tooling | Where customer-success time is not logged per account, it is modelled from territory size, account count and meeting volume, and the figure carries a lower confidence label. The ratio is read against the median for the account's segment, not against a fixed scale. | Reading | Against the segment median | | -------- | -------------------------- | | Strong | 80% of the median or below | | Adequate | 80-110% | | Elevated | 110-150% | | Critical | Above 150% | Segment medians differ substantially. At template defaults they are 22% for enterprise accounts, 16% for mid-market and 11% for SMB. An enterprise account at 20% sits inside its segment norm; an SMB account at the same figure is a structural outlier. Two rules stop noise reading as a trend. Cost elevation is recognised only after two consecutive months above the band. Accounts in their first three months are measured against an onboarding band, because onboarding costs run about 1.4 times steady state by construction. ## Where it comes from | Source | What it supplies | | ------------------------------------------ | --------------------------------------------------------------------------------------- | | Billing | Required. The recurring revenue the cost is measured against | | Support or ticketing | Ticket volume, severity, escalations, time to resolution | | Professional-services or project system | Hours consumed against contracted, scope amendments, project completion | | CRM, customer-success platform or calendar | Customer-success hours, meetings and touchpoints. Modelled where not logged per account | | Cloud infrastructure billing | Per-account compute, storage and bandwidth allocation | A figure appears once an account has 90 days of post-sale history, three completed monthly cost roll-ups, and cost data at a confidence of 70 or above. Below that confidence the ratio is withheld rather than published thin. Where fewer than 50 closed-account records exist for a segment, the segment bands are template defaults and are labelled as estimates rather than as your own norms. ## How fresh it is Recalculated on the first business day of each month, after the cost roll-up completes. It is also recalculated within four hours of a severity-one support escalation, a professional-services overrun of 20% or more, an infrastructure cost rise of 25% or more month over month, or a change of customer-success owner. A mid-cycle recalculation is published with a marker saying so. The monthly recalculation seals the month. Segment medians, bands and the weighting behind the cost driver are recalibrated and sealed quarterly, once at least 50 closed-account records exist for the segment. ## Currency and rounding `cost_to_serve` is a ratio of two figures in the same currency, so it carries no currency of its own. `cost_to_serve_amount` is stated in your single reporting currency; costs incurred in other currencies are converted at their own rate before any total is formed. Every read of the currency figure is recorded in the access log. ## What changes it Movement in any of the five cost categories. Movement in the recurring revenue it is measured against — a contraction raises the ratio without any cost changing at all. A change of segment triggers a recalculation, because the median the ratio is read against has moved. The quarterly recalibration moves the segment medians for the periods that follow. A change in your growth plan moves the threshold at which an elevated cost is flagged for action; it does not move the figure, and it never moves the critical threshold. ## What it is not * Not gross margin. Margin is calculated with cost to serve rather than by it — recurring revenue less cost to serve, against your margin profile. Margin is a separate value. * Not a profitability verdict. The figure detects and attributes cost. Whether an account is worth what it costs, and what to do about it, is decided separately against the account's own economics. * Not comparable across segments. Enterprise accounts routinely cost more to serve than SMB accounts at equal health, which is why the figure is read against the segment median rather than against other accounts. * Not `customer_value`. Cost to serve is one input to that value, inverted. It is not a version of it. * Not one situation. Three different ones produce the same number: onboarding cost in the first months, which resolves itself; cost rising alongside usage, which is a tiering conversation; and cost rising while usage falls, which is a structural problem. The cost driver published alongside the figure is what separates them.