What is revenue per employee?

Revenue per employee (RPE), sometimes called revenue per headcount, is an efficiency ratio that shows the average amount of revenue generated by each full-time person. It doesn’t include contractors or outsourced work.

How to calculate revenue per employee?

Revenue per employee formula: total revenue / number of full-time employees. For example, if a company generates $1 million in total revenue during 2022 and has 100 full-time people, the average revenue per person would be: Revenue Per Employee = $1,000,000 / 100 employees = $10,000.

What is a good revenue per employee in SaaS?

A “good” revenue per employee (RPE) benchmark depends on the size and maturity of your business. Many SaaS experts point to the $250,000–$300,000 per person range as the level companies typically need to reach in order to go public and operate as cash flow–positive businesses.

What influences revenue per employee?

Several factors can affect your revenue per employee (RPE). These include industry, company life cycle, and employee turnover. Each of these factors can significantly impact how your RPE changes over time and should be considered when analyzing efficiency.

3 ways to improve revenue per employee?

1. Boost employee retention. 2. Support information mobility. 3. Revamp pricing strategies. These approaches help improve workforce productivity and increase the average revenue generated per employee.

What type of ratio is revenue per employee?

Revenue per employee is an efficiency ratio used to measure the average revenue generated by each full-time person. It helps you evaluate productivity and how efficiently your workforce is generating profits for the company.

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