Sales per labor hour: how to calculate it and use it

Sales per labor hour (SPLH) is your net sales divided by the total hours your team worked in the same period. If a store took $31,200 last week and the team clocked 735 hours, its SPLH was $42.45. It tells you how much in sales each hour on the clock produced.

Count every clocked hour, salaried managers included. Use net sales, after discounts and before tax and tips. Then look at it by daypart, not just by week, because the weekly average hides the slow afternoon where the hours are going.

What is sales per labor hour?

SPLH is a labor productivity number. It answers a plain question: for every hour someone was on the clock, how much did the store sell?

It is different from labor cost percentage. Labor percentage divides wage dollars by sales. SPLH divides sales by hours. That difference matters more than it sounds. When you give the crew a raise, labor percentage goes up even if nobody's schedule changed. SPLH stays put, because the hours did not change. So SPLH is the cleaner way to ask whether the schedule fits the business.

How to calculate sales per labor hour

The formula is simple:

1. Take net sales for the period. That is sales after discounts, before sales tax and tips.
2. Add up every hour on the clock for the same period. Hourly crew, shift leads and salaried managers all count.
3. Divide net sales by total hours.

Most POS and scheduling systems, like Square, Toast or 7shifts, can export both numbers for the same date range. Make sure the dates match exactly. A sales report for Monday to Sunday and a labor report for Sunday to Saturday will give you a number that means nothing.

If you left the 95 salaried hours out, you would get $48.75. That looks like a better week. It is the same week, with part of the crew hidden.

Why salaried hours belong in the denominator

A salaried GM working the lunch line is serving customers. Those hours produced sales just like a crew member's did. Leave them out and two things go wrong. Stores with more salaried staff look more productive than they are. And a store that moves a salaried manager onto the floor to cover a gap looks like it gained productivity when it only changed who stood at the grill.

There is a flip side. Never take your labor cost and divide it by labor hours to get an average wage. POS labor cost is hourly labor, the wages of hourly staff only. It leaves out salaries. Your hours include salaried people. Divide one by the other and you get an average wage that is too low, and every decision built on it will be off.

Keep the two numbers in their own lanes. SPLH uses all hours. Hourly labor percentage uses hourly wages. Fully loaded labor, with salaries, payroll taxes and benefits, is a P&L number that comes from your books.

How to read SPLH by daypart

A weekly SPLH is a grade. A daypart SPLH is a map. It shows which hours on the schedule carry the store and which ones are just on the clock.

Opening prep and close will always read low or zero. That is fine. Someone has to slice tomatoes and mop. The useful comparison is between the selling dayparts.

Here, the afternoon stands out. Seven people are on for three hours to sell $600. Lunch, with the same kind of crew, sells more than twice as much per hour. The fix goes on next week's schedule: end two lunch shifts at 2 PM instead of 5 PM. That takes the afternoon from 21 hours to 15, and lifts it to $40.00 an hour. Nobody's shift today changes.

A very high SPLH is a warning too. If lunch at another store runs at $95 an hour, check ticket times and reviews for that window before you celebrate. The store may be short, and guests may be waiting. Staffing to demand cuts both ways, and our guide to improving speed of service covers what a short lunch does to the line.

How to set a sales per labor hour target

Start with the store, not a number from a blog. Find the store's last eight normal weeks, leaving out holidays and weeks with a closure. The middle of those weeks is a fair starting target. Then compare it with the middle store in your brand, if you have more than one location or your franchisor shares figures.

Once you have a target, it becomes a staffing budget:

Then spread those 750 hours across the week to match the sales forecast by hour. Our guide on how to build a restaurant schedule walks through that step.

Ranges vary a lot by concept, region and service model. A counter-service store with a high ticket can run well above a full-service dining room with servers and bussers. Comparing your burger store with a sit-down restaurant across town tells you nothing. Compare like with like, and read how to benchmark franchisee performance fairly before ranking stores against each other.

Common sales per labor hour mistakes

• Leaving salaried hours out. It flatters the number and hides real gaps.
• Using gross sales or including tax and tips. Use net sales every time, so weeks compare cleanly.
• Dividing labor cost by labor hours to find an average wage. Cost excludes salaried pay, hours include salaried people, and the answer is wrong.
• Reading only the weekly number. The slow afternoon and the short lunch cancel each other out in the average.
• Chasing a higher number every week. Past a point, a rising SPLH means guests are waiting longer.
• Forgetting price changes. A menu price increase lifts SPLH with no change in how the store runs. Track orders per labor hour beside it to see real productivity.
• Comparing across service models. A drive-thru store and a dine-in store staff differently for good reasons.

How to raise SPLH without hurting service

There are two sides to the fraction. You can move hours, or you can sell more in the hours you already staff.

Moving hours is the faster fix. Use the daypart view, find the slowest selling window, and trim or shift hours there on next week's schedule. Never send someone home early from today's shift or cut into breaks to hit a number. Those changes belong to the next schedule, and workforce rules in some cities and states require notice for schedule changes anyway.

Selling more is the better fix. A slow afternoon is often a sales problem, not a staffing one. Catering orders built ahead of time fill the quiet hours with prep that pays. Our guide to growing catering sales shows how stores book them. An add-on offered at every order raises the ticket on every hour you already pay for. Faster lunch lines serve more guests with the same crew.

A simple weekly SPLH habit

Every Monday, for each store:

1. Pull last week's net sales and total clocked hours, salaried included.
2. Calculate SPLH for the week and for each daypart.
3. Compare the week with the store's own last four weeks and with the middle store in the brand.
4. Pick the one daypart that is furthest off, low or high.
5. Fix it on next week's schedule, then check the same daypart a week later.

One change a week is enough. After a month, the schedule fits the store much better than it did. If you run several stores, put SPLH beside sales, hourly labor and ticket times in your weekly restaurant KPIs review.

Franlever's AI COO does the first three steps for you each morning. It reads each store's POS sales and labor hours, compares them with the store's own recent weeks and the middle store in the brand, and texts the owner or GM one specific lever when a coverage gap stands out. On a normal day, it sends nothing.

General information for restaurant and franchise operators, not legal, tax, accounting or financial advice. Figures in examples are illustrations, not predictions or promises of results. Laws and platform policies change and differ by location, so check the current rules and talk to a qualified advisor about your situation.