How To Calculate Revenue Per Headcount

To create cost per head measures you.

How to calculate revenue per headcount. It s important to understand a company s revenue per employee in order for a company to find effective uses for its employees. For example imagine a company has a yearly revenue of 5 million and has an average of 100 employees for that year. The third major category of measures that you will learn is people cost measures. To perform the revenue per employee calculation divide the revenue 5 000 000 by the number of employees 100.

It helps as a measure of average financial productivity for each employee of the company. However revenue per employee figures allow you to see how much each employee in a certain part of your business contributes to revenues. In this case you would find the revenue per employee formula gives you a ratio of 50 000 per employee. You need to provide the two inputs i e revenue and number of employees.

You can easily calculate the revenue per employee ratio using formula in the template provided. Revenue per employee ratio formula in excel with excel template here we will do the same example of the revenue per employee ratio formula in excel. Let s take a closer look some sample figures from company xyz. Annualized cost per head represents the cost to the company of having one employee on a full year basis.

Revenue per employee also called sales per employee is a financial ratio that measures the revenue generated by each employee of the company on average. In this video we discuss what is revenue per employee ratio. It equals the company s total revenue divided by the average number of employees for the period. It is very easy and simple.

Revenue per employee is calculated by dividing a firm s revenue by its total number of workers revenue number of employees. Revenue per employee 40 000 net revenue 850 000 average fte 21 25 of course you should also look at profit numbers not just revenue figures. Along with its formula calculation examples of tech industry banking industry and auto manuf. The revenue per employee is a calculation which will calculate how much revenue each employee brings in for the company on average.