Revenue Per Employee Metric

Setting aside those exceptional cases and focusing instead on saas companies the typical average revenue per employee is about 190k to 210k per year.

Revenue per employee metric. It suggests that the most valuable use of an organization s talent is the creation and use of intangibles. Compare revenue per employee year over year for your hr leader. There s only one metric that really matters when measuring hr. The term revenue per employee rpe ratio refers to the financial metric that measures the dollar amount generated by each employee of a company.

Revenue per employee is an essential financial ratio calculated by dividing revenues generated for a specific period by the number of employees in a company. The difference is that viewing profit per employee as the primary metric puts the emphasis on the return on talent. Take the revenue produced by your company or business unit and divide it by your total number of employee ftes for the budget geeks in the house. In other words this metric assesses how well a company is able to leverage its manpower in order to make more revenue.

It helps as a measure of average financial productivity for each employee of the company. Company name revenue per employee over the past x years. What is revenue per employee ratio. Total sales revenue number of employees.

This metric should be considered against an industry average a good average length of service can vary greatly across sectors. It s called revenue per employee rpe. This ratio is among the most universally applicable and is often used to compare companies within the same industry. Here are some charts on some big name.

Revenue per employee calculated as a company s total revenue divided by its current number of employees is an important ratio that roughly measures how much money each employee generates for. The best way to do look up this metric is to go to wolfram alpha and enter a query like this. Revenue per employee is a measure of the total revenue for the last twelve months ltm divided by the current number of full time equivalent employees. Google and facebook the two most efficient companies generate 1m per revenue per employee per year.

This approach focuses the minds of managers on increasing profit relative to the number of people a company employs. Measuring this metric can help you to see where greater investment might help to generate higher returns.