Declare the period, revenue and workforce basis
revenue per FTE = period revenue ÷ average full-time-equivalent headcount
- period revenue
- Revenue on the declared currency, tax and recognition basis (currency per declared period) — business record or user scenario
- average full-time-equivalent headcount
- Workforce denominator on one documented FTE method for the same period (FTE) — business record or user scenario
The linked planner also shows contribution per FTE and direct-labour cost rate. It supplies no external benchmark.
Before comparing scenarios
- Use the same period, currency, tax and revenue-recognition basis. (not complete)
- Document whether the workforce denominator is point-in-time or average FTE. (not complete)
- Treat employees, owners, contractors and outsourced capacity consistently. (not complete)
- Reconcile direct labour and other variable cost before reading contribution per FTE. (not complete)
- Record business-model, capital, mix and timing changes that could explain movement. (not complete)
- Compare the same business first; do not import an unsupported industry benchmark. (not complete)
Compare workforce and contribution scenarios separately
Same revenue, then same FTE
All figures are fictional generic currency-unit inputs evaluated by the Revenue per Employee engine. They are not a market benchmark or forecast.
| Scenario | Period revenue | FTE | Revenue/FTE | Contribution/FTE | Safe interpretation |
|---|---|---|---|---|---|
| A: same revenue with 8 FTE | 1,000,000 | 8 | 125,000 | 62,500 | A smaller declared denominator raises both per-FTE amounts; it does not prove higher productivity |
| B: same revenue with 10 FTE | 1,000,000 | 10 | 100,000 | 50,000 | A larger declared denominator lowers both amounts; capacity and workload still need review |
| C: same 10 FTE, higher other variable cost | 1,000,000 | 10 | 100,000 | 30,000 | Revenue/FTE is unchanged while contribution/FTE falls, showing why revenue alone is incomplete |
Choose the next staffing question
| Finding | Next workflow | Boundary |
|---|---|---|
| Need exact internal revenue/contribution per FTE | Revenue per Employee Scenario Planner | No external productivity benchmark |
| Staffing-cost share changed | Staffing Cost Percentage Planner | Definition and period must stay explicit |
| Considering a future role or cost mix | Labour Budget Scenario Planner | Budget is not a hiring forecast |
Revenue per employee questions
- What is a good revenue-per-employee number?
- This guide supplies no universal number. Use a consistently defined internal baseline and compare it with contribution, staffing cost, capacity, workload and business-model changes.
- Should headcount or FTE be used?
- Choose and document the denominator that fits the decision. The Margin101 planner uses FTE; do not compare it with raw headcount without reconciling part-time and period treatment.
- Is higher always better?
- No. A higher ratio can reflect price, mix, outsourcing, capital use, reduced capacity or denominator changes. It does not prove profitability or sustainable performance.
Methodology source
- Margin101 Revenue per Employee methodology — Margin101: Exact formulas, inputs, units, fixture and no-benchmark limitations.