If its selffunded, andor is primarily freemium, the. Gap widens between bestofthebest professional services. When taking revenue per employee into account it is clear that the business is only generating. Average revenue per employee of professional services within software companies worldwide from 2015 to 2019 in 1,000 u. Revenue per employee total ranking has deteriorated compare to previous quarter from to 2. Tech companies that make the most revenue per employee. Revenue per employee 2017, the softletter benchmark 53, executive summary. How to figure out your competitors revenues in about 70. The revenue per employee is a calculation which will calculate how much revenue each employee brings in for the company on average. The worlds largest companies have many similarities, but the size of their respective org charts is not necessarily one of them.
It results from your business performance and is generally used by investors or acquirers to benchmark. This can help inform management decision making suggesting that they might look for further efficiencies in the business before taking on another. Whether the goal is to organize the worlds information or to build an algorithm that makes millions of lives easier, pretty much every tech company in existence aims to leverage software in some way to do the types of jobs that would otherwise be impossible or uneconomical for humans to do. Major vendors, by revenue per employee published by statista research department, mar 16, 2011. What is the typical revenue per employee for a b2b saas.
Revenue per employee 2017, the softletter benchmark 53. Spi research announces the top 20 2016 bestofthebest professional services organizations who excelled in leadership, client relationships, talent. How software companies revenues per employee stack up. Preparing a benchmark for it spending or it employee staffing levels can be a difficult exercise for any business. View revenue per employee annual for sap access over 100 stock metrics like beta, evebitda, pe10, free cash flow yield, kz index and cash conversion cycle. This figure sits almost in the middle of the table. Benchmarking your industry interestingly, smaller firms, which you would expect to be more productive than their larger competitors actually average just. Over time, the revenue per employee changes as the startup scales from pre revenue through to seed stage and beyond. Tableau software inc s revenue per employee quarter by quarter results, averages and statistics, financial information csimarket. This is a broad measure that can indicate overall performance, optimal staffing numbers, and uncover problems accompanying sales strategies. Through the use of the revenueperemployee ratio, a company can. Overall, energy companies led the pack in revenue per employee, followed by healthcare and utilities. Benchmarking saas startup efficiency with revenue per.
What is average revenue per employee for software companies. For example, your theoretical fidget spinner company has 21. Revenue per head in software sammy abdullah medium. Surprisingly, technology companies performed at the lower end of the range on revenue per employee. May 03, 2019 revenue per employee is a ratio that is calculated as companys revenue divided by the current number of employees. The figure for sales revenue can be found in the income statement. Analysts at expert market dug through data on the top 100 companies in the world in terms of revenue, and showed us how much each makes per employee.
Revenue per employee is a ratio that is calculated as companys revenue divided by the current number of employees. Healthcare sector efficiency, revenue per employee, inventory. Which companies have the highest revenue per employee. Recently a list from inside public accounting ipa came out listing the best of the best accounting firms for 2008 top 25 and then next 25 honorable mentions. Publiclytraded saas companies have an average revenue per employee of. The quarter of study respondents that have average collection periods below 58 days prove that significant improvement is achievable. The sector we operate in shows average revenue per employee for a small 1049 employees business of. We found that energy companies have the highest average revenue per employee, while industrials and consumer discretionaries perform worst on this metric. Just take your total sales revenue and divide it by your total employees or fulltime. Publiclytraded saas companies have an average revenue per. Just take your total sales revenue and divide it by your total employees or fulltime equivalents ftes.
Two metrics we use to compare software businesses are revenue per employee. Dec 14, 2010 revenue per employee earlystage companies typically have very low revenueemployee. I would like your thoughts on a question that continues to bother me regarding the key performance indicator we use at the firm, revenue per employee. High revenue per employee indicates that a company has found additional ways to obtain more sales from each employee.
How software companies revenues per employee stack up barrons. Benchmarking your industry interestingly, smaller firms, which you. The chart of the week is a weekly visual capitalist feature on fridays. Revenue per employee is the ratio of revenue generated per employee of a company on an average. One recent study in the technology industry software, hardware, it services, etc found that the top 10% of companies ranked by performance had roughly twice the revenues per employee as the average. The arr per fte metric is not a metric youll use to pilot your business. The histogram above shows the ranges for publicly traded saas companies. Feb 07, 2020 average revenue per employee of professional services within software companies worldwide from 2015 to 2019 in 1,000 u. Revenue per employee earlystage companies typically have very low revenue employee. But more than that, enabling smartphones and tablets in an organization also managed to reduce operational costs by a whopping annual average. This template will help you calculate revenue per employee on quarterly, half yearly and yearly basis. This statistic depicts average annual revenue per employee of professional services within software companies worldwide between 2015 and. Usually the number of employees keeps on changing over the period. Here, we would consider four firms from the same industry.
Download revenue per employee calculator excel template. Tableau software inc revenue per employee data, sales per. Net revenue per employee, an excellent indicator of a. Its important to understand a companys revenue per employee in order for a company to find effective uses for its employees. You should also consider your total salary, wages, payroll taxes, and benefit costs as a percentage of revenue relative to your industry averages and. Setting aside those exceptional cases and focusing instead on saas companies, the. Which companies make the most revenue per employee.
Top tech companies revenue per employee business insider. Our it spending and staffing benchmarks study makes the job easier by providing an it spending framework with hundreds of ratios, statistics, and other it cost metrics for strategic it budget analytics. A company can, of course, streamline its organization and use tools such as formal networks, talent marketplaces, and knowledge marketplaces 5, to mobilize intangibles throughout the ente to the extent that it does so, its profit per employee. The formula for calculation of revenue per employee is given below. If a software company grows at 20% annually, it has a 92% chance of ceasing to. Fte calculator, employee cost, and revenue per employee. The survey found that enabling tablets and smartphones in these companies boosted productivity by percent per employee, and increased revenue by 12 percent. Healthcare sector efficiency, revenue per employee.
The only performance goal youll ever need for hr leaders. This ratio is most useful when comparing it against other. Within technology sector 3 other industries have achieved higher revenue per employee. Jun 15, 2017 which companies make the most revenue per employee. Each milestone often has a higher revenue per employee with ones at. The salesperemployee ratio can be especially insightful when measuring the efficiency of businesses such as banks, retailers, consultants, software companies, and media. Its as straightforward a calculation as you could hope for. However, does revenue per employee translate into bottom line performance. Revenue per employee is an important financial ratio calculated by dividing revenues. This ratio is most useful when comparing it against other companies in the same.
Revenue per employee benchmarks of billion dollar companies. This is a broad measure that can indicate overall performance, optimal. The median headcount of these companies at ipo was 933 with the average. On average, companies in the energy sector make at least 2x per employee than others. Revenue per employee earlystage companies typically have very low revenueemployee. As jesse hulsing pointed out to me, examining this figure over five years reveals quite a bit about the health of the business.
However, revenue per employee figures allow you to see how much each employee in a certain part of your business contributes to revenues. Whether the goal is to organize the worlds information or to build an algorithm that makes millions of lives easier, pretty much. But, that analysis examined revenue per employee that only one point in time. Here are five important metrics i believe every software ceo should focus on. Over time, the revenue per employee changes as the startup scales from prerevenue through to seed stage and beyond. Revenue per employee compares each employees average efficiency compared to your stores overall revenue figures.
One way of measuring the efficiency of a companys revenue model is to benchmark revenue per employee. Pharmaceutical commercials begin to be more interesting. We have created a simple and readytouse revenue per employee calculator in excel with predefined formulas. Businesses calculate revenue per employee by dividing total revenue by total number of employees. This statistic depicts the average annual revenue per employee of professional services within software as a service saas companies. Also public companies which have huge revenues pad this number by having 50100150% of their ftes as contractors, i. Revenue per employee 40,000 net revenue 850,000 average fte 21. It spending and staffing benchmarks 20192020it budget. You also realize the way you do it isnt the only way it can or should be done.
Revenue per employee sales revenue number of employees. Therefore, it is preferable to use average number of employees during the period. Through the use of the revenue per employee ratio, a company can determine efficiency and use that assessment to make adjustments to operations. For revenue per consultant, we set utilization targets based on a 70% utilization rate which accounts for downtime such as vacation, stat holidays, professional development. This figure sits almost in the middle of the table and reflect that fact that accounting and legal firms rely on human capital with specific knowledge and are reliant on people rather than machines.
1136 848 1382 1136 33 1518 1247 232 1424 1391 924 418 676 1352 1218 140 1048 492 1540 17 1178 237 1108 672 573 626 375 1389 606 1418 351 3 193 114 152 475 530 732 452 1026 1105 16 411 1304 964 398 622 167 268 693