Operating Revenue Per Employee

This ratio gives an idea about how the company will perform in a specific quarter especially considering the revenue vs cost of each employee of the company.

Operating revenue per employee. Revenue per employee is affected by a company s employee turnover rate where turnover is defined as the percentage of the total workforce that leaves voluntarily or is fired each year and. Revenue per employee formula. It also called known as sales per employee. Revenue per employee is an operating performance ratio that is used to measures the average revenue generated by each employee of an organization.

Given only the revenue and number of employees of different companies operating in the same industry use the revenue per employee ratio to find which company is more productive. You can easily calculate the revenue per employee ratio using formula in the template provided. In other words this metric assesses how well a company is able to leverage its manpower in order to make more revenue. Generally labor intensive industries use these metrics.

Profit per employee is a measure of net income for the past twelve months ltm divided by the current number of full time equivalent employees. Labor intensive industries are those industries where the value of human capital is more than the. 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. The term revenue per employee rpe ratio refers to the financial metric that measures the dollar amount generated by each employee of a company.

A company can of course streamline its organization and use tools such as formal networks talent marketplaces and knowledge marketplaces 5 to mobilize intangibles throughout the ente to the extent that it does so its profit per employee should increase even in the absence of profitable new value propositions if it removes any unproductive complexity. It is very easy and simple. 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. John reports to his manager that facebook s revenue per employee is 1 5691 million per employee.

Revenue per employee is an essential financial ratio. It equals the company s total revenue divided by the average number of employees for the period.