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When looking at revenue / employee, in businesses where wages are the biggest cost (eg: software), that ratio also gives you a upper bound to how much you can p
by andruby 5y ago
When looking at revenue / employee, in businesses where wages are the biggest cost (eg: software), that ratio also gives you a upper bound to how much you can pay employees and still be profitable.
In my book, revenue / employee is much more meaningful than profit / employee, because profit is arbitrary to a large extent.
- nbstme 5y ago+1 and I should have mentioned that there are significant disparities, say per country, of how much an employee costs.