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What percent of your revenue should be allocated to payroll?

Deciding how much of your bottom line to dedicate to employee salaries is a critical consideration to make. Payroll is frequently one of the most significant expenditures for a business owner. Not only is payroll a regularly occurring expenditure, but  it also comes with strings attached: taxes, insurance, and additional add-ons like vacation time, sick days or credits. For managers trying to hold on to already-slim margins, payroll can feel like the Achilles’ heel that can make or break a business operation.

Unfortunately, there is no one magic payroll number that can be applied to every business. However, taking your degree of profitability into account along with other business functions can aid you in determining a reasonable ratio of payroll to revenue. Service businesses, in which typical manufacturing is replaced with sheer manpower, can take on higher payroll percentages since the payroll is, in fact, the product.

Your employees productivity is the most important number of all and is the amount of production your employees give the business per hour, measured by the output divided by employee cost, and is a huge variable that can be significantly influenced by management efforts.

In order to determine whether you are currently on the right path or if you may be setting your business up for trouble, examine the ratio of your payroll expenses to gross revenue.

Once you have compared these two numbers, look at payroll as a percentage of gross revenue. If your payroll expenditures fall within 15-30% of gross revenue, your business is in a safety zone of sorts with solid footing. Businesses that live within this range tend to be most successful, at least from a payroll perspective. However, there are many businesses, usually within the service industry, who operate with payroll making up more than 50% of their gross revenue.

Too many business owners fail to include themselves in the payroll equation, and therefore come out anticipating payroll numbers that are deceivingly low. Regardless of whether owners take a traditional paycheck or qualify their income as “owners draw” it should be included in any payroll calculations to provide an accurate picture of finances.

Knowing your business’s ratio of payroll to revenue is only the first step in solidifying your business assets, however. The larger issue is choosing to do something about that ratio. Too many business owners are clueless when it comes to reducing payroll while maintaining or increasing productivity. Exploiting this potential is the secret to business stress.

There are a number of ways to accomplish this but the point of this post is to learn how to  identify the red zone, after 30% and then to figure out what to do about it if it is higher. First take a hard look at your actual payroll costs, the real costs, which include not only staff salaries but also the “extras” previously mentioned like insurance and taxes. Be sure to also calculate your own earnings accurately, and then compare this tally against your gross revenue. If your percentage falls above 30%, in the red zone, it’s time to come up with a new strategy immediately.  Maintaining a payroll that falls above 30% of your gross revenue is one of the most common reasons for a business to fail.

Identify first and then fix…take the test today and then call me for help I can help you fix this issue, easily, quickly and safely.

To learn more about our debt workout strategy, and how it can handle IRS payroll tax concerns, please speak with our team.

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89 Responses to What percent of your revenue should be allocated to payroll?

  1. Madeleine says:

    Your article started me thinking. Should the rate be constant- say 20%- or should it have some fluidity like revenue?

  2. it definately has a relationship with revenue but productivity is the issue, I say make more with fewer people, use incentives as wll as training for success.

  3. JORGE says:

    What about non-profit service organizations? What may be the percentage or ratio between gross revenue allocated to payroll? I am the controller of a private school and our percentage of revenue allocated to payroll is always over 60%. And yes we are in financial trouble. Is there any general rule that aply to schools?

  4. Jacob says:

    We are currently at 31% and are in need of a solution. A very successful business owner gave us a very dumb down version of how his company set the line in the sand at 25 cents on every dollar and clams by the time the company was bought they had taken a 25k employee and where producing 200,000 gross instead of there previous 100,000 average. This all done by he says giving the employees anything they can make below the 25 line. So his example was in one year the employees had out performed due to the carrot they had dangled and where now running at 20 cents on every dollar and the 5% was now divided by all 100 employees. The company was at 25million in annual sales. My question is how did this work?

    • Jacob
      Its all about productivity, and is the key to profitable operations. imply sated, if the same group of employees produce more with the same overhead in place then profits go up dramatically and there is adequate room to share the increase with the employees so both win, It is the incentive which drives the employees to perform more efficiently and the reward is cash distributions for the employees and increased profits for the company. There are a few posts on this subject in the blog, search the word productivity.

  5. diane miller says:

    I work for a large retail corp, where payroll budgets are still operating on the same scale as 4 years ago, resulting in my working alone, short handed, I am salary and every week I am working 20 hours more than I should, I do about 35,000 per week and my payroll % is 7.2% , I have argued that this is impossible thereby always being over in payroll, 3 minimum wage hikes, employee raises and none of this is ever written in, does this seem like a fair % range?

  6. Jennifer says:

    What about a museum (non-profit)? What should the percentage range be? For the last year payroll percentage was 79% of income. All we have is employees. We are a museum. Are we in trouble?

    • Donald Todrin says:

      It sounds to me as if it may be a problem, . Hard to tell without knowing your overhead requirements and other financial needs, but safe to say 79% is very high.

  7. Don’t these percentages depend a great deal on the average gross margin for the type of business. 20% of a company that makes 50% gm is much different than for a business that only makes 25% gm.

  8. Dan says:

    Very interesting post and Q&A. I am the executive pastor of a church (i.e. religious non-profit). I noticed you suggest that 50% should be the target cap for a non-profit. Our payroll is currently at 57%. We have always targeted our maximum at 55%. Since we depend entirely on donations, how does employee productivity relate to the payroll cost target? What recommendations can you make for financial course corrections with either cost or income?

    • Don Todrin says:

      you hit the nail on the head…productivity is the key, sated goals and accomplishments, measurable success should determine payroll then the % is less relevant., include benchmarks, key indicators, how much by when and you will succeed in controlling your payroll if it is pegged to successful implementation of tasks.

  9. Prathnesh says:

    What should be the payroll % to revenue generated in a standard hotel. Is 12 -15 % the ideal range or it should be more??

  10. oliver says:

    great article!

  11. Jane Letourneau says:

    I own a small service oriented business in the legal profession. My payroll at best, is in the 40-50% range of revenues. Is that normal or appropriate for this type of industry? It wildly fluctuates season to season.

  12. Jacob Vance says:

    If a seasonal, service business has payroll expenses which are 45% of Net Revenue ( gross revenue minus redeemed gift certificates/coupons ),does it appear to you the business is in trouble?

    • Don Todrin says:

      I depends. usually gross payroll is computed as a % of gross revenue, trying to keep it lower then 1/3…it is very hard to determine the % of net revenue without knowing what the other numbers are.

  13. David says:

    What benefits should be counted as part of payroll IE: medical, IRA, 401k etc? Or should it be strictly hourly and salary gross amounts?

    • Don Todrin says:

      This is purely speculative, it depends upon profitability and how you want to treat your employee. There are no hard and fast rules, however the better you treat them the more likely they will stay with you long term.

  14. Todd says:

    I currently operate a retail furniture store. What % of payroll would you say is sufficient for this type of business??

  15. ruben2009 says:

    We are planning to open a coffee shop. My question is whether the percentage of payroll should be a% of total sales,% of total expenditures or income as% of average.
    ___% Of total monthly sales
    ___% Of the profit after expenses
    ___% Of total expenditures. Including inventory, materials and equipment, utilities and raw materials, etc …

    thank you very much

    • Don Todrin says:

      It should be a % OF TOTAL REVENUE and because it is a restaurant low wages supplemented by tips it should be under under 15% However gross revenues will drastically fafect the % up or down.

  16. Alex Hart says:

    I own a company http://www.tuxship.com with my dad.I enjoyed this post. Thank you.

    Alex

  17. Katie Rogers says:

    Good post. But my question is how do you define “measuring employee production” by the amount of revenue they generate/hour?

    If you could elaborate on how you determine the number based on the below paragraph
    The percentage of your employees productivity is the most important number of all and is the amount of production your employees give the business per hour, measured by the output divided by employee cost, and is a huge variable that can be significantly influenced by management efforts.

    • Don Todrin says:

      Yes Katie, that’s exactly it, the amount of production in dollars divided by the number of employees in production divided by the number of hours worked. this gives you productivity.

  18. Katie Rogers says:

    Thanks Don–for the quick response. Once you get this number–doesn’t the range of “what is productive” depend on the industry?

  19. Ken Ambroise says:

    This is great information. I own a service industry business. Residential care homes.
    My question is can productivity be high but if your paying your staff to high of a wage your bottom line will still be affected?

  20. Aaron says:

    I manage an RV resort in Ma. Our sales last year were $850,000. I have 23 employees most of which make minimum wage. We are definitely a service based company. We do have some retail, a bar & a golf course (all profitable 30-50%) for ancillary but the rest is servicing the RV sites & the guests who rented them. I came in under budget last year @ 18% and now my COO says that we need to be at 9.5%. I like to think that I am a good manager and have never missed a payroll budget and have only ever missed a sales budget twice and not by much. She stated that this is standard in our industry. I am having a hard time with this. Help me…

  21. Stacy says:

    I own a chiropractic private practice. We have several Massage therapists, physical therapists, an administrative assistant, an office manager, and another chiropractor in addition to myself. Because our employers are our service our payroll costs and taxes are high. Last year these totalled 68%. Is this typical for a fee for service type business which has no revenue other than this?

    Thanks!

    • Don Todrin says:

      Stacy, its very high, too high, either increase revenues or decrease overhead, there is no room for profit.

  22. michael c says:

    We are at a ratio of 42% of total income and 55% of Gross Profit. The cost of payroll incucles the following Gross Payroll,Sales Commissions,Social Security & Medicare,,State Unemployment,· Federal Unemployment, State Disability Taxes, · Bonus,· Uncategorized Payroll,· Simple IRA

    Am I overcalculating the expenses of payroll. We are a software development compamy and have a hardware platform we have manufactured. The COGs effects the GP and the Software engineer increase the number of employees

    • Don Todrin says:

      michael c,
      you are high but the real answer is what does your profit look like, how high is it, it is not uncommon to have a high payroll ratio when you have a high profit margin and large revenue…it all depends…if you are not as profitable as you want to e then yes your payroll is very high.

  23. karen says:

    i own a small insurance agency…. when you say payroll, does this include the owners wages as well??

  24. Jim says:

    Don,
    Great stuff. I have a business investment I am considering. A contracting company that installs materials in residential homes.
    I can acquire this business for a very small investment.

    Sales – $2,050,000
    GP% – 52.5%
    Wages – 64.5% of GP
    Opp Expenses – 28.5% of GP
    Net Earnings – 7% of GP

    Does this seem sustainable.

    Thanks,
    Jim

  25. jon says:

    When calculating payroll, do you include all benefits (taxes, health insurance, etc) or just the salaries? Also, do you include cost of sales (food and merchandise) as part of the overall expenses?

  26. Irvinder says:

    We are IT Trading and Service Company.Our Total Revenue for Last Financial Year was USD 3,827,370.
    What Percentage shld be our Salary Bill.Please advice.

    • Donald Todrin says:

      Irvindor, it is more complex then that and I urge you to read the post carefully as it tells you how to figure it out, but I will say, service businesses have a wide swing depending upon profitability, anywhere from 230-50% can work, but it depends upon the business. There is no cost of goods so it can be higher then manufacturing or retail. Don

  27. mark kwiatkowski says:

    i work for a small food processor distribution company. what % should the route distribution be at. the route drivers are full service. not drop and run.

  28. J P says:

    I run a substantial architec/engineering firm that does business across the United Stated, and I can assure you with the salaries we have to pay for licensed professinal engineers and architects, and other technical personnel, there is no way we can get to a 20% to 30% pay as percentage of gross income.

    i am not sure what you are classifying as a service business, but I thinki for professional organiations such as ours, your assumptions are greatly flawed. I have been in this business 1 years I think the only time had a pay under 30% was when Istarted the business in 1970 and took almost no salary and did all the work myself. When you offer professional services like we do that require intense hands on work, there is no way you can delegate your repuration and licesse to some cheaped out grunt.

    We hage grown to be a national company with hundreds of employees, and have never had a payroll percentage as low as 30% My personal opinion is that you are full of it, and are providing flawed advice to businesses, especially those provideing professinal services to the public.

    • Donald Todrin says:

      I am delighted for you that you are so successful, however I suggest you consider reading the entire sentence and not just a fragment of it, as you may notice I also said in the same sentence that many service companies operate successfully with a payroll up to 50% OF REVENUES but that 30% is a great objective to achieve. It depends on so many factors also stated in my post including profit factors and overhead requirements.

      I appreciate you feel I am full of it, not sure how that works here as I am certainly not particularly impressed with your opinions, however its all good. Thank you for writing. I am sure my readers will benefit from your well thought out analysis.

  29. kleit says:

    great information, i own a grocery store. we have 21 employees, few of which make minimum wage. What should the percentage range be for grocery business? great post

    • Donald Todrin says:

      depends on so many factors, profitability, market comparisons, etc, reread my post and follow the directions you will figure it out.

  30. greg says:

    Donald,
    we are a service provider
    sales 2,100,000.00
    wages 60%
    total exp 1,837,000.00

    wages are high, master degrees and two PT that have doc degrees.

    what does is say?

    • Donald Todrin says:

      If this is your net profit, you are doing fine. 60% is very high, ad should be worked back to 505 BUT BY INCREASING REVENUE NOT DECREASING PAYROLL. As long as you are profitable, this seems ok but high. If its working for you keep it, just increase revenue.

  31. john says:

    I run a manufacturing screen printing and embroidery business. Our products are mostly contract decorated and have no garments to mark up to help with margins.
    Gross Sales – 932,000
    Gross Payroll -45%
    We had to run ALOT of overtime this past year in order to produce the product on time for our customers.

    I am trying to get to 35% payroll which I feel is a good number.Our business is growing fast and I
    Realize I need to increase revenue. I am leaning towards a second shift as aposed to purchasing another piece of production equipment to run on 1st shift. Your thoughts….

    • Donald Todrin says:

      John, I have two thoughts, overtime is a killer and must be eliminated at all costs, productivity is the issue, and a second piece of equipment would be far more cost efficient then a second shift, however there is another way to improve productivity and that is with incentives. Create a reward based incentive program based on the number of t shirts put out per day and pay per shirt ad watch productivity go through the veiling ad profits ride. The overtime is an incentive to produce less during the 49 hour shift. If everyone gets paid more based on their productivity, number of shirts out, everyone does better especially the company. The worst thing that you cud do is allow overtime, the second worse thing is add a shift. Keep one shift and let them earn my productivity, you will see results. Te employees will ear more and the company will be fat more profitable, and your customers will be happier. One word of caution, you must watch quality control because they will want to hurry and will accept anything.

  32. Eddy says:

    I am a partner in a Law Firm which operates on a contingency basis with pur client’sWe have 5 associates. My partner and I take a nominal draw each month . On average for last 4 years, revenue has been 4.5 million-5.2 million. Payroll including draw is about 25-30%.That would include the nominal draw. How do I figure in our partner salary if draw is simply a nominal monthly amount. We tend to take additional draw when firm can handle it; quarterly?

    How can I better understand our situation. Thanks

    • Donald Todrin says:

      Eddy,
      Nice job, as the largest line item for any business is typically payroll and you have managed to keep it in an excellent ratio. If there is little or at least affordable debt, and your overhead is also reasonable, rent insurance, library, etc,. you should have massive profits available for distribution and quarterly distributions would be fine. Pull an income statement from your accounting system and it will tell you exactly how you are dong and distribute half the retained profits quarterly leaving the remainder for security in the firms account. Actually what I would recommend is distributing weekly into a firm savings account. Then distribute half of it quarterly to you and your partner.Nice job.

  33. Sonia says:

    I am currently working in a telecommunication company with 28k employees… and the ratios lie between 50-60 %… what do you suggest it should be for a telecom?

  34. The company I work for is in the Tax Resolution industry. This is 100% service and my questions relate to measuring productivity and payroll as a percentage of Gross Sales.

    Regarding productivity to complete a case it crosses many desks and departments with lower wages in the $10/hour range. The Tax Professionals include lawyers, CPA’s and EA’s make professional wages. Since all cases are different in liability (IRS) and complexity (liens, unpaid years, expenses, business or personal, etc.) they take varying times to complete. A case might take 15 hours to complete but elapsed time is 7 months. How do you measure productivity with some degree of accuracy?

    Second, what should the payroll target be as there are limits of how many cases a professional can work effectively? We are running less than 50% of gross sales.

    Thanks (Please email answer to me.)

  35. sam martens says:

    Hi Don, Ive read your suggestions and I think you give great advice> I have additional questions, We own a coffee shop, haven’t, but will start taking a salary, employess paid above min wage, I looked at the what you said to figure payroll % and understand, my question is, when you say production $ your saying sales correct? and how do you get to that range? this is all new to us, thank you

    • Donald Todrin says:

      yes, in your case production equates to sales dollars. Its easy, just apply the principles and get to where you need to be, non emotionally and with focus and clarity…just do it.

  36. Felipe says:

    We are an internet reseller and have profit margins around 12-14%.
    Gross Sales – 3,500,000
    Gross Payroll – 23%
    Just having the website and running is costing the other 77%. This to me seems very expensive…thoughts?

    • Donald Todrin says:

      Wow, seems crazy, our payroll is at a great level, how coud your cost of goods and operation be so high, you must be selling for too low a margin, i cannot evaluate without more info but this seems crazy with the volume you are doing.

  37. keyur says:

    What should be the ideal payroll for an exporting company?

    • Donald Todrin says:

      it is determined by a wide variety of issues, and they ll must be considered. I cannot answer without much more information.

  38. Jeff says:

    Hi I have recently taken over the financial management of a start-up tech firm specializing in Sharepoint consulting. I have owned mulitple restaurants in the past and understand payroll/labor % well in that field, but am having a hard time figuring out what is normal/acceptable in this field. We are about 1.5 years old and run as high as 65-70% We have revenue of about 2m. We also have zero debt. Rent (which is about 5%) and other expenses that total about another 5-6% are the only costs to us. We are profitable, but I just can’t get over the fact that we seem way too high on labor as a %. Can we maintain this long term? Productivity can definitely help this to some extent, but if we bring on new projects we will have to hire more consultants. Thanks for your time and help in advance!

    • Donald Todrin says:

      Productivity will help, however you are correct your payroll percentage seems way too high, especially in view if your low overhead, your business should be running on a lower payroll.

  39. Jeff says:

    Hello. Great information here! I have recently taken over the financial management of a start-up tech firm specializes in Sharepoint consulting. Prior to this new venture I have been the owner and operator of a multi-unit cell of a national restaurant chain and have a solid understanding of payroll/labor % in that industry. However, in this professional/consulting industry I am having a difficult time figuring out what is normal/acceptable. We are roughly 18 months in business and our payroll runs as high as 65-70%. We are currently on pace to have revenue of 2 million+. We do operate with 0 dept. Our lease and operating expenses run about 5% and 6%, respectively. The company is operating on a profit, but due to my prior experience in the restaurant world it is hard for me to stomach labor % to be so high. Do you think this is maintainable long-term? I understand that an increase in productivity would lower this %,but our consultants have their hands full and if we bring on more projects we will have to hire more consultants. Thanks in advance for your time and insights!

  40. Jeff says:

    I apologize for the double post. I was getting an error message and didn’t think that the post went through.

  41. Suzanne says:

    Hi there!
    My husband and I are general managers for a coffee shop that has been open since Dec 2, 2010. The shop plans to run like an NPO once we are in the black. The owners do not want or need a salary and will be giving any profit away. The tricky part is that my husband and I work 50-80 hours a week (in and out of the office) and deserve the good salary we make (about 55,000 total). In a typical situation the owners would probably take a little less of a salary in the beginning and supplement once sales increase, but our situation doesn’t really allow that. I will have to look again, but I believe payroll costs (including our salary and all taxes, etc.) came to about 50% of Gross Sales for 2011, our first true year in the business. I imagine there is a timeframe of some sort for brand new businesses to build sales and therefore decrease labor percentages. Do you have any thoughts on how long it should take to be able to get payroll percentages down to 35% or so (numbers most coffee shops have given me as a goal)? Thanks so much!

  42. shabeel says:

    WE are agriculture company owns 2000 acres how is ideal percentage of SALARIES TO NET REVENUE? Is there any reference for more details about this issues THANKS IN ADVANCE

  43. Jim says:

    Donald, what resources would you trust the most to obtain salary comparison data for a faith based, parachurch, 501(c)3 service and media organziation. I’m familiar with PayScale, who else in that space… we’re looking for the baseline information to evaluate our salary grades and begin linking that to performance (organizational and individual).

  44. Baoque says:

    I am now in charge of c& B in a commercial bank.
    Can you give me an advice of a suitable salaries (compensation) – to operating expenditure , salaries – to – gross revenue ratio, salaries – to – profit ratio?
    Is 30% a common ratio?

    • Donald Todrin says:

      30% is always a good number however depending upon how profitable your business may be and the depth of the revenue you may be able to afford more, however i suggest you pay more with bonuses not salary.

  45. DFraizer says:

    I run a non-profit child care resource and referral agency. Federally and locally contracted for direct services. The primary function of our staff is to work directly with families and child care providers providing technical assistance, providing trainings, processing paperwork, etc. How much should we allocate for payroll in our budgets? Any other resources that might be useful for me?
    Thanks!

    • Donald Todrin says:

      DF
      The objective is to pay adequately yet return a profit to the company. You ,must determine what your anticipated revenues will be, take out a reasonable profit % and then deduct your overhead, rent phones insurances, etc, then with whats left compute a commission or payroll that fits within whats left. For a service agency in the private sector it could be from 30-50% I leave the rest up to you.

  46. hany says:

    i am working in a commerical bank, and the ratio for staff expenses to total revenue is 22%, while to operating profit 37%. please advise if this ratio is high.

    • Donald Todrin says:

      Staff expense is not the entire payroll picture, thus the ratio is incomplete, add officers salaries and let see what the number is then. I susppect the ratio is good maybe a little low but as mentioned incomplete info.

  47. Nathan says:

    I have a barbershop and i have three employees. I pay 40% of gross sales per month as commission to the 2 specialists and a salary to one. Is the commission too high, because my payroll costs are abt 55%?

    • Donald Todrin says:

      It is high but within reason for your industry. Are you making a profit? Are you including yourself and your revenuer?
      Dont include yourself and calculate the %.As a barber you can be counted but more than the 40% is an owners draw. Since you are asking you are probably concerned and not making as much as you want… add another barber or stay open longer another night and increase revenue over the same overhead.
      dt

  48. Ishaq says:

    What woud be an ideal payroll ratio to gross sales for an engineering service company… Engineering service company employees highly skilled and experienced persons… besides it also includes cost of various high end softwares which are expensive … Other than this it also required latest technological supports … Please suggest

  49. Tricia says:

    Hi
    I have a dog walking company and it is time to add employees to help me do the work. I want to make sure I am factoring in all the expenses before landing on a percentage to pay a new walker. To keep things simple:
    If I charge $20 a walk ( gross )
    What are my expenses that I MUST include?
    Federal and state taxes, SS tax, Unemployement tax, business insurance ( I assume I divide this by 2 since I do some of the walks too), bonding insurance ( smart to have ), workmans comp insurance ( not sure how important this is ), gasoline allowance for each walker ( could they write off their own?), supplies ( ie bags, leashes ect )… Am I forgetting something obvious?
    Would my marketing expenses be separate?
    —- In short I would like to put together a formula that breaks down how much it would cost to add an employee and when and how I would turn a profit off of them.
    $20 service charge for a walk
    ____% taxes
    ____$ insurance
    ____$ supplies
    ____$ operating expenses
    ____$ payroll per walk/ walker
    ( ____$ net profit to business owner)
    I understand how to work towards profitability by getting customers in a tight radius and I am brainstorming on how I could give them bonus incentives to drive more revenue/ new cutomers.
    With all that above information what percentage do you think I should start off with? And with that suggested percentage what goal should I have as a net profit for myself ( the owner ) ? Understanding that I can control certain things like expenses.
    Thanks in advance!!
    You can reply here but I would love an email reply too if you don’t mind.

    • Donald Todrin says:

      I would approach it differently and keep it simple, I would treat them as independent contractors, pay them $10 per walk and thats it. They cover their own expenses, they are not employees.

  50. Shawn Acker says:

    I am so happy as of 2012 you are still answering questions on this. I want to start a none-profit for children. But I have no clue as to what kind of cut I should take for the company, Marketing, Webpage fee’s, Do I give myself a cut? What would a good percentage be. I can’t seem to find anything online to answer my question

  51. Pat Kelly says:

    We are being asked by one of our clients what % of payroll including benefits are norms in their industry. They are in the hotel management industry, they both own and manage.

  52. Lynn says:

    Hi Donald,
    I am very interested in your article because I have worked for a company which used payroll/revenue percentage as one of the HR Metrics. After 1 year, the matrix was changed to payroll/contribution gross profit percentage. I am an HR generalist. I do not have finance background. Would you be able to help me answer the following questions?
    1) What is the purpose of using the payroll/contribution gross profit percentage? Which industry/companies widely use this metric?
    2) What is the essential difference between the payroll/revenue percentage and the payroll/contribution gross profit percentage?
    3) What are pros and cons for the above 2 metrics to evaluate the labour productivity or labour efficiency?

    I look forward to hearing from you?

    Lynn

  53. Manas says:

    I am a salaried(INR 20000) employee working in a training institute handling PRO activities,all grievance , organizing conference . But now i am going to bring a new business opportunity (currently we are not into that)without using institute man power and product. Only i will use institute logo. So what should be the sharing ratio between me and the institute?

  54. H J Bester says:

    In am involved in an Old Age Home as a board member and has to consider a yearly budget. Ever increasing expenses are constantly causing us making plans to make ends meet without increasing levies too much. What is the norm for this type of business with regard to payroll expense as percentage of gross income ?

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