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% of revenue per job to wages

Discussion in 'Business Operations' started by grassrootsinab, May 4, 2006.

  1. grassrootsinab

    grassrootsinab LawnSite Member
    from up here
    Messages: 215

    I've done a search on Lawnsite and can't find the answer I'm looking for so I thought I'd float this question:

    What percentage of the total revenue (gross) per job are you guys paying out in wages? I think by looking at the percentage, we get away from the local influences and fluctuations on price and minimum wage etc.

    I've seen alot of discussion about hourly vs. by the job (where legal) pay schemes but I haven't seen what most companies are paying their employees by the job percentage wise. I'm a small operator (about 40 contracts a week) and have a part-time employee. I'm paying about 30% of revenue to wages...is this high?
  2. grassmanvt

    grassmanvt LawnSite Senior Member
    Messages: 906

    I can't remember the exact number I've come up with but, it was about 1/3rd by the time all taxes and w/c were figured in. This was for someone toward the higher end of my pay scale. A newbie with no experience would be a bit lower.
  3. rodfather

    rodfather LawnSite Fanatic
    Messages: 9,501

    20.77% for Payroll Expense and 6.61% for Payroll Taxes, says QB's...hope that helps ya.
  4. topsites

    topsites LawnSite Fanatic
    Messages: 21,653

    30% is good for starters (no offense) but the quoted amounts are much leaner and actually better figures.
    The quoted amounts add up to 27.some percent... About the only co's run lower figures are large corporations have been in business for 50-100 years, they usually run below 25 percent but 27-odd is good, real good.

    Every percent is a dollar per hundred.
    If you gross 100k in a year and you only run your figures one percent leaner than last year, that's a thousand dollars pure profit.

    It's just a way of saying 30 percent could use some tweaking, but it's a solid start.
  5. rodfather

    rodfather LawnSite Fanatic
    Messages: 9,501

    Seeing that I pay my people very well ($17.50 - $22.50 an hour), I could be even lower if I paid like most LCO's do.

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