Are you spending too much on labor?
As a pet care business owner, you understand this industry relies on the skill and dedication of your staff. You likely also understand labor costs often make up a pet care company’s biggest expense. As passionate, pet-loving people, many business owners think “whatever it takes to deliver great care is what it costs,” and key measurements can get away from them. Unfortunately, so does profit and, if not resolved, so does the viability of your business. The long- and short-term success of your business depends on controlling labor costs—without sacrificing the quality of care you provide.
What Makes Up Your Labor Ratio?
A pet care business’ labor ratio is measured as total labor costs divided by total revenue and should be consistently monitored and managed.
Your labor ratio is the percentage of revenue you spend on your staff, including wages, employee benefits, payroll taxes, and more. Many pet care companies spend as much as 50% or more of their revenue on labor. Although there is no universal “right amount,” lower labor ratios combined with quality care mean a healthy, profitable business.
Every company’s ideal labor ratio depends on a wide variety of interwoven factors including the owner’s involvement, regional market, area wages, the services you offer, and even the layout of your building(s).
If you’ve struggled with your labor ratio, you likely realize there are two main ways to bring it down:
- Increase your revenue while maintaining your current labor numbers
- Learn to reduce your labor ratio percentages—while still providing quality care
Strange as it may sound, most owners and managers are afraid to reduce labor. Why?
- They worry the quality of pet care will suffer
- They fear losing quality staff
- Concerned about losing customers and ultimately their business
- They fear the outside perception of increasing profits
None of these need to happen.
Can I Balance Great Care and Healthy Labor Spending?
Yes! The excellent quality of care you provide does NOT need to be compromised to meet a healthy labor ratio. While it can feel like a balancing act between overspending and underspending, our expert tools and guidance will help you achieve the best labor ratio to keep you delivering the pet care you’re proud of.
No matter where your ideal labor ratio lies, you’re bound to run into problems if you overspend or underspend.
Unfortunately, most pet care companies are spending too much on labor, which means:
- You’re burning precious revenue needed for facility upgrades and improvements
- Your personal income will suffer, putting your investments and credit at risk
- Less revenue likely means less marketing, further reducing your ability to draw and keep new clients
- The financial stress can mean decreased quality of life for you
- The long-term value of your business will suffer, and you won’t be able to sell for top dollar
Teija Heikkila, principal broker at National Kennel Sales and Appraisals, warns “High labor cost is the #1 reason for reduced valuation and low sales price for a business in our industry. Buyers focus on the highest possible ROI and if payroll is eating all your profits, it will have a dampening effect on your ability to sell or at what price point you want.”
What Do We Do?
Based on factors including your location, services, and building(s), every company’s ideal labor ratio is different.
The experts at Outstanding Pet Care have the tools, background, and skills to not only identify your labor ratio but help you reach your ideal labor goals, all while improving the quality of your care.
Our step-by-step process will help pet care business owners and managers:
- Understand and calculate your own labor ratio by department
- Identify opportunities within your business to improve efficiency
- Improve your labor ratios without sacrificing the quality of your pet care
- Learn the most common labor mistakes and how to avoid them
- Learn to budget appropriate time per task
- Discover the importance of building quality standards into each task
- Find the right balance of full-time, part-time, and seasonal staff
- Create and maintain a culture of efficiency
A professional Labor Coach is assigned to each company to ensure maximum success.
This labor-saving program walks each professional through the necessary steps to improve their own labor ratios while maintaining or even improving their quality of care. Practical and clear information, common situations and challenges, solutions, and meaningful exercises are provided for each client.
Like all of Outstanding Pet Care’s programs, our Labor Ratio Reduction services are guaranteed.
Take control of your labor expenses for as low as $1,995 per month
I have seen firsthand that Laura Laaman and the Outstanding Pet Care team substantially increase her clients' revenues and significantly outperform the industry norm. These increases were essential in helping OPC clients command top dollar when it came time to sell. She guarantees her client's success in writing;
I can't imagine why anyone would not be an OPC client.
Teija Heikkila, Principal Broker at National Kennel Sales & Appraisals
In just 18 months, Outstanding Pet Care increased our revenue by over $1,000,000. Due to this increased revenue, we received a minimum of $1,000,000 in additional revenue when we successfully sold our business.”
Chris Starko, Nashville, TN
We have been working with Laura Laaman since 2004. Since then she has helped us transform our business in ways we could never imagine. In the first month, the busiest time of the year, with no additional capacity we increased our revenues by 33%. The best part is although we always provided exceptional care, our pets were even happier and healthier. Since working with Laura and her team we have conservatively realized an additional $5,000,000 in additional revenue to date. Any company that works with Laura will understand her commitment to quality pet care and that her proven systems will equal success.
Walt & Joanne Morris, Morris Animal Inn
Rover Oaks has been a client of Outstanding Pet Care program for years and couldn't be more pleased with the results! It's nice to see that, thanks to the guidance and support of the OPC team, our revenues and profits can match the level of care we provide!
Steve Smith, Rover Oaks Pet Resort
Hiring Laura and the OPC team was a pivotal defining moment for our business. In our first year with OPC, we increased $330,000 over our previous year. She was instrumental in helping us transition from an all-inclusive lodging model where our revenue per pet per night was capped, to a more progressive and profitable model where the sky is the limit. We like to call her our revenue rainmaker!
Hailey Seidel, Bow Dog Canine Specialists