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Sales/Labor Ratios

Discussion in 'Business Operations' started by Tony Muto, Feb 18, 2008.

  1. Tony Muto

    Tony Muto LawnSite Member
    Posts: 3

    Are there any industry measures/benchamrks for the optimum sales per labor hour and sales per labor dollar? How about for labor %, as a % of sales? I ask these questions as I try to detrermine expectations for efficiency of labor.
  2. Labour should not exceed a maximum of 60% of the total expense budget. The lower the %, the better. Just be careful not to run yourself to thin on labour.
  3. Tony Muto

    Tony Muto LawnSite Member
    Posts: 3

    Oh Canada!!

    What % do you beleive expenses for cost of goods, equipment and general operating expenses should be, as a % of sales?
  4. PROCUT1

    PROCUT1 LawnSite Platinum Member
    from TN
    Posts: 4,909

    In a service business you should strive for 30% of gross sales. though in this business it is not uncommon to be in the 40-45% range
  5. MacLawnCo

    MacLawnCo LawnSite Bronze Member
    Posts: 1,847

    Im projecting 42.8% for this upcoming year, including labor burden. Id like to get it closer to 50% but that is only going to happen by reducing other variables, not increasing pay.

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