The #1 metric to track to improve profitability in your business
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Күн бұрынWant to increase profit in your business? The answers lies in tracking the labor productivity. When labor is being used efficiently, profits increase. But when we have waste or inefficiency in the system, profits will be down.
The way we track labor productivity is through the Labor Efficiency Ratio. It is the number one metric to track if you want to be more profitable. Don't know how to measure it? That's what this video will show you!
Hannah will explain the labor efficiency ratio and also show you real-life examples of calculating this ratio in a few different ways. She will also help you identify some pitfalls that some business owners fall into when trying to calculate this themselves.
Mentioned in this video:
Interview with Greg Crabtree: • Interview with Simple ...
Podcast with Greg Crabtree: • Keeping It Simple With...
Simple Numbers Book: www.claracfo.com/simplenumbers
To learn more about CFO services for B2B services providers making over $1M in annual revenue, go to: claracfo.com/cfo-services/
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Hannah Smolinski is a #CPA and the Founder of Clara CFO Group. Find out more about Clara CFO Group at claracfo.com/
Disclaimer: This video is intended for educational purposes and should not be taken as legal or tax advice. You should consult with your financial professionals about your unique financial situation before acting on anything discussed in these videos. Clara CFO Group, LLC is providing educational content to help small business owners become more aware of certain issues and topics, but we cannot give blanket advice to a broad audience.
CODE: MB014PH0URNYAUO
@dr.carolineware 26 күн бұрын
How is this number different for e-commerce based businesses? Or do you do a different calculation? Thank you so much for your videos. You're a blessing.
@evelynechristie7181 3 ай бұрын
I read Greg's book. He mentioned in the book that subcontractors are included in the COGS. Direct labor is on a separate line below gross profit. Gross profit minus direct labor is the contribution margin. In your video, you said subcontractors are direct labor. Can you please explain?
@AromaRetail 4 ай бұрын
Thank you so much for this video! I ran a manufacturing/retail business, so we do not provide services but products to our customers. Any available advice for me, and this type of business?
@ClaraCFO 4 ай бұрын
Have you run this calculation? If your COGS are accounted for properly, this calculation should still be valuable.
@AromaRetail 4 ай бұрын
I have, thank you. @@ClaraCFO
@naveenkgeorge2000 4 ай бұрын
Great Video...Could you please do a video on headcount planning and profit profitability(Software company)
@ClaraCFO 4 ай бұрын
Will take that into consideration!
@naveenkgeorge2000 4 ай бұрын
Sorry mispelled it's Project profitability
@VDO259 4 ай бұрын
Thank you so much!
@BravoCompany-o9d 13 күн бұрын
If you talk math, you are talking my language.
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