Consulting firm Owner Earnings per Hour
Owner return = (revenue − costs excluding owner pay) / owner hours
Gather time sheets, engagement scopes and invoice ageing. Include delivery hours, preparation, and travel. The starting figures are examples. Replace them with your own records.
Formula and worked example
Owner return = (revenue − costs excluding owner pay) / owner hours
| Input | Example |
|---|---|
| Period revenue | 15,000 |
| All costs excluding owner pay | 10,000 |
| Owner delivery and admin hours | 180 |
| Calculated result | 27.7778 per owner hour |
Choose reliable inputs
Account for delivery time, review work and when you expect to be paid for each engagement. For this consulting firm calculation, use time sheets, engagement scopes and invoice ageing and a consistent definition of one engagement.
- Delivery hours: include the portion belonging to this engagement or reporting period, and record where the value came from.
- Preparation: include the portion belonging to this engagement or reporting period, and record where the value came from.
- Travel: include the portion belonging to this engagement or reporting period, and record where the value came from.
Use the same currency for every money input. Do not mix weekly costs with monthly revenue, or count the same expense in both an itemised cost and allocated overhead.
Should I include unpaid admin hours?
Include selling, travel and administration. This is pre-tax return and does not value invested capital.
What if this input changes?
If period revenue rises by 10%, this example changes by 8.3333 per owner hour. This shows the effect of one change; it does not predict what will happen.
Open the calculator, save your baseline, then change the input supported by the least reliable estimate in your records. Compare both scenarios before committing to a price or capacity promise.