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Analysis of Agencies with Revenues
Between $2,500,000 and $5,000,000
EXPENSE ANALYSIS
(as % of Net Revenues)
Average
+25% Profit
+25% Growth
Compensation Expense
Total Payroll
57.3%
52.1%
54.0%
Benefits
8.5%
8.6%
8.5%
Total Compensation
65.8%
60.6%
62.5%
Selling Expenses
T & E/Conventions
1.1%
1.0%
0.8%
Automobile
0.8%
0.8%
1.0%
Advertising/Promotions
1.3%
1.2%
1.4%
Total Selling
3.2%
2.9%
3.2%
Operating Expenses
Occupancy
3.7%
3.7%
3.7%
Telephone
0.9%
0.8%
0.8%
Postage
0.6%
0.6%
0.7%
Supplies/Printing
1.1%
0.9%
1.1%
Dues/Subscriptions/Contributions
0.8%
0.6%
0.5%
Taxes/Licenses
0.6%
0.2%
0.3%
Insurance
1.2%
0.9%
1.1%
Professional Fees
0.8%
0.5%
0.8%
Equip Rental/Maint
0.7%
0.5%
0.8%
Bad Debts
0.3%
0.1%
0.3%
Outside Services
0.4%
0.4%
0.2%
Data Processing
1.1%
1.0%
1.1%
Education/Training
0.4%
0.2%
0.3%
Miscellaneous
0.7%
0.5%
1.0%
Total Operating
13.3%
11.0%
12.5%
Administrative Expenses
Amortization
1.0%
0.8%
0.8%
Depreciation
1.2%
0.7%
0.6%
Officer Life
0.3%
0.3%
0.2%
Interest
0.6%
0.0%
0.3%
Other
2.4%
1.2%
0.0%
Total Administrative
5.4%
3.0%
2.0%
Total Expenses
87.8%
77.6%
80.1%
Pre-Tax Profit
12.2%
22.4%
19.9%
Information Technology Expense (as % of Net Revenues)
Average
+25% Profit
+25% Growth
Total IT Expense for Fiscal Yr
(1)
1.8%
1.3%
1.3%
(1)
Includes hardware/software leasing, supplies, maintenance & maintenance contracts, training, data communications,
website development/maintenance, computer depreciation, and software amortization
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
Page 58
2003 Best Practices Study