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Key Benchmarks
Profile
Revenues
Expenses
Profitability
Employee Overview
Producer Info
Staff Service Info
Technology
Insurance Carriers
Appendix
84
Analysis of Agencies with Revenues Between $5,000,000 and $10,000,000
2011 Best
Practices Study
Agencies with
Revenues Between
$5,000,000 and
$10,000,000
Average
+25% Profit
+25% Growth
Revenues (as % of Gross Revenue)
Commercial Lines
45.4%
42.5%
43.0%
Bonds
1.0%
0.4%
0.4%
Personal Lines
23.5%
29.6%
25.4%
Value Added Services
0.6%
0.4%
0.0%
Contingent/Bonus
7.6%
8.1%
7.9%
Group Medical
12.7%
11.9%
12.8%
All Other Group
3.4%
3.0%
2.1%
Individual L&H
3.6%
2.0%
6.6%
Bonus/Overrides
0.8%
0.8%
1.0%
Investments
0.5%
0.2%
0.6%
Miscellaneous
0.9%
0.5%
0.1%
Total Revenues
100.0%
100.0%
100.0%
Brokerage Commission Expense
1.4%
0.6%
3.9%
Net Revenues
98.6%
99.4%
96.1%
Expenses (as % of Net Revenues)
Compensation
66.5%
59.4%
66.6%
Selling
3.2%
2.6%
3.3%
Operating
13.9%
11.5%
11.8%
Administrative
3.6%
1.9%
3.5%
Total Expenses
87.1%
75.5%
85.1%
Pre-Tax Profit
12.9%
24.5%
14.9%
Pro Forma Pre-Tax Profit
1
17.6%
31.0%
19.8%
Operating Pre-Tax Profit
2
3.7%
14.9%
5.0%
EBITDA
3
16.3%
26.2%
17.3%
Pro Forma EBITDA
21.0%
32.7%
22.2%
1
Pre-tax Profits if discretionary expenses are
eliminated and all owners compensated as
employees
2
Pre-tax Profits excluding contingents, bonus
and investment income
3
EBITDA—Earnings Before Interest Taxes
Depreciation and Amortization
Profit/Loss Summary
Profit/Loss
(as % of Net Revenues)
Profitability