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Hi ‘namedropper’

Been quite a few months since you posted this question, but I’ve just come across it, did you find out what you needed? The following may help..

Although not fully costing your potential employee as you specified, a very rough rule of thumb is to think in terms of the rate charged to your customer and split it into thirds as follows:

1/3 to pay your employee’s costs
1/3 towards other business costs
1/3 towards profit

So if employee costs are $25/hour, this equates to a customer pricing of $75 / hour. Of course many factors at play for your business, so it really depends, but hopefully that’s a rough guide. If you do the sums in reverse from the rate you are able to charge your customer, then you can roughly determine a budgeted amount to pay employees.

When I worked for a large, well known, IT consulting business, they would charge clients more than the thirds above at almost 4x the daily rate they paid to the consultants.


The Financial Architect (http://www.thefinarc.com)