Labour percentage is a great business metric in understanding how healthy your business is performing for the month, quarter or year.
Labour percentage can be worked out by taking your total sales revenue and dividing it by total payroll.
A healthy percentage for most businesses including retail and hospitality is around the 20% mark.
Labour percentage data can be used to determine if labour costs are running too high or low within your business, compared to sales targets being met. For example, if you spent $50, 000 in labour costs for your first quarter and gross sales brought in during the same quarter was $250, 000, then labour percentage works out to be 20% for that quarter.
Roster Elf allows managers to enter actual sales results and understand total labour percentage. This allows your business to stay on budget and control business costs. As managers create their weekly roster with shifts and enter sales targets,
RosterElf will automatically determine labour percentage. For RosterElf to display accurate labour percentage, pay rates and pay templates need to be set for each staff based on the award category your industry falls under. This includes weekday, weekend, overtime and public holiday rates.