Revenue Per Employee

Revenue Per Employee is an operating performance ratio that looks at a company's sales/revenue in relation to the number of employees they have.

Revenue Per Employee

Revenue Per Employee is an operating performance ratio that looks at a company's sales/revenue in relation to the number of employees they have.

 


Calculation of Revenue Per Employee

Revenue Per Employee = Revenue / Average Number of Employees

Interpretation of Revenue Per Employee

Industry and product-line characteristics will influence this indicator of employee productivity. Tracking this dollar figure historically and comparing it to peer-group companies will make this quantitative dollar amount more meaningful in an analytical sense.

Revenue per employee is also influenced by the age of a company. Young companies usually have small revenues and they are usually in the process of hiring employees to fill key positions.


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