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Labor Cost Percentage illustration

Franchise · Cost

Labor Cost Percentage

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Use labor cost percentage to track wages against sales, a key control metric in food-service and retail franchises where labor can quietly erode margin.

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Interactive workbench

Cafe staffing

Labor Cost / Revenue * 100

$12,000 of labor on $40,000 of sales is a 30% labor cost.

Check your inputs before you rely on the result — calculations are informational only and depend entirely on the numbers you enter. See our Terms.

Variables and units

  • Labor Cost

    Total wages for the period.

    currency

  • Revenue

    Total sales revenue for the period.

    currency

Common mistakes

  • Leaving payroll taxes and benefits out of labor.
  • Using a different period for labor and sales.

Step-by-step example

Cafe staffing

$12,000 of labor on $40,000 of sales is a 30% labor cost.