What Is Revenue Per Employee

It s important to understand a company s revenue per employee in order for a company to find effective uses for its employees.

What is revenue per employee. If a company has a high revenue per employee amount then that is an indication that. The term revenue per employee rpe ratio refers to the financial metric that measures the dollar amount generated by each employee of a company. This ratio is among the most universally applicable and is often used to compare companies within the same industry. It helps as a measure of average financial productivity for each employee of the company.

What is revenue per employee ratio. Revenue per employee is impacted by several factors. The revenue per employee ratio is important for determining the efficiency and productivity of the average 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.

Revenue per employee formula. The revenue per employee is a calculation which will calculate how much revenue each employee brings in for the company on average. 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. Revenue per employee is a measure of how efficiently a particular company is utilizing its employees.

This ratio is among the most universally applicable and is often used to compare companies within the same industry. It equals the company s total revenue divided by the average number of employees for the period. In other words this metric assesses how well a company is able to leverage its manpower in order to make more revenue. In general relatively high revenue per employee is a positive sign that suggests the company is finding ways to squeeze more sales revenue out of each of its workers.

Revenue per employee is calculated as total revenue divided by number of employees. 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. 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.