2003 Best Practices Study

Analysis of Agencies with Revenues Between $500,000 and $1,250,000

EXPENSE ANALYSIS (as % of Net Revenues)

Average

+25% Profit

+25% Growth

Compensation Expense Total Payroll

52.1%

51.5%

51.7%

Benefits

8.9%

6.7%

7.3%

Total Compensation

61.0%

58.2%

59.0%

Selling Expenses

T & E/Conventions

1.3% 1.6% 1.6% 4.4% 4.4% 1.6% 0.9% 1.8% 1.0% 0.3% 1.9% 0.8% 0.6% 0.2% 0.6% 2.2% 0.5% 1.3% 0.6% 1.4% 0.2% 1.7% 0.0% 3.8%

0.9% 1.5% 1.2% 3.5% 3.1% 1.3% 0.9% 1.4% 0.8% 0.2% 1.2% 0.7% 0.4% 0.1% 0.2% 2.0% 0.4% 3.7%

2.2% 2.0% 1.7% 5.9% 4.8% 1.5% 1.0% 2.5% 1.5% 0.5% 2.2% 0.8% 1.1% 0.1% 0.5% 2.2% 0.8% 0.5% 2.4% 2.1% 0.2% 1.5% 0.0% 6.2%

Automobile

Advertising/Promotions

Total Selling

Operating Expenses Occupancy

Telephone

Postage

Supplies/Printing

Dues/Subscriptions/Contributions

Taxes/Licenses

Insurance

Professional Fees Equip Rental/Maint

Bad Debts

Outside Services Data Processing Education/Training

Miscellaneous

Total Operating

18.1%

16.4%

19.8%

Administrative Expenses Amortization

-4.7% 1.5% 0.2% 0.1% 0.0% -2.9% 75.3% 24.7%

Depreciation Officer Life

Interest

Other

Total Administrative

Total Expenses Pre-Tax Profit

87.3% 12.7%

91.0%

9.0%

-10.0% 0.0% 10.0% 20.0% 30.0% 40.0% 50.0% 60.0% 70.0% % Net Revenue

Compensation

Selling

Operating

Adminstrative

Average +25% Profit

+25% Growth

Information Technology Expense (as % of Net Revenues)

Average

+25% Profit

+25% Growth

Total IT Expense for Fiscal Yr (1)

2.9%

2.9%

3.6%

(1) Includes hardware/software leasing, supplies, maintenance & maintenance contracts, training, data communications, website development/maintenance, computer depreciation, and software amortization

Page 28 2003 Best Practices Study