Thanks for a great post. Hugely enjoyed it. I’d suggest the best use of this data would be tracking the change over time. A great way to catch early inflection points.
I think your right indeed that tracking this over time will be helpful and interesting. Perhaps I make this a yearly thing. We'll see. Feel free to shoot through some companies you think are interesting and are not on the list.
Top notch article and I am going to go through the lists very carefully for the gems hidden by a solid clod of dirt. Rev per staff member is a good metric for many professional businesses, indeed any biz which charges for time.
But, a caveat. The staff member has no control over revenue (read pricing of the tech
/service sold). That’s managements job and they can get it horribly wrong by incorrectly positioning it in the market. A very personal example: many years ago I wrote a set of business manuals for small/medium businesses. Started selling them at $169. Did all right. Then a marketing guy said to me ‘too cheap’, the perception is they cannot be any good. Increase the price to $489, he said. Absolutely heresy to my left Bain accounting background, but I did. They sold better than at $169. Go again he said. Try $695 but throw in an annual monthly newsletter, he said. I did, and they sold more and quicker than at $489. When I sold the biz in 2007, a much enlarged set of manuals sold for $3,000. Not possible today because the internet has made information pretty well useless.
My point is management is responsible for building the perception which dictates the price which determines the revenue. I would nominate Wayne Hooper of Laserbond as being one who is underselling his tech because he hasn’t built the perception of the value of what he offers the market.
Met a yank called Harry Schulz many, many years ago. His claim to fame was that he charges $3,000 an hour for his advice. And many flocked to him. I later discovered that his guarantee was this ‘and if I don’t deliver value, I will give you an additional 10 hours absolutely free. Harry’s probably still counting his loot in heaven.
Your comments are always the best Damian. That story about the business manuals is priceless. It reminded me of some of the stories in 'Influence', the Book by Robert Cialdini (which this marketing guy may have read from the looks of it).
Robert shares this story about a clerk in a store mistakenly increasing the price of every diamond, rather than discounting them. The result is obvious of course; sales went up.
Good to see a real story supporting this theory.
You're right though that management must take ownership of this important point, and it's very difficult in general.
Thanks for reading, and your quality comments as always.
I met Bob Cialdini in Phoenix in the late 1990's. he is the real deal. Actually watched one of his experiments which he called 'priming' where a beggar was set up with a hat in front for coins. he proved they could influence the amount of the donation if they used a primer who came in from the side & put a dollar note donation in. It did influence the qantum of the donations but can't remember the pecentage increase. It was about the same time I saw a pan handler in New York with a sign 'Bad Advice - just $1"' He was doing okay, too!
I regard ''Influence'' as the best business and life book I have read and would have given away around 60 to friends and associates.
Thanks mate! I think Audinate are probably a good example of a lot when it comes to reporting. The PE of 100 makes it a company that you're betting on for the long term, but I definitely understand people who make that bet.
Great read. Very interesting. Could staff costs as a percentage of revenue in the half and yearly report provide more accurate results than Linkedin employee numbers?
Thanks for a great post. Hugely enjoyed it. I’d suggest the best use of this data would be tracking the change over time. A great way to catch early inflection points.
Thanks mate for the comment.
I think your right indeed that tracking this over time will be helpful and interesting. Perhaps I make this a yearly thing. We'll see. Feel free to shoot through some companies you think are interesting and are not on the list.
Top notch article and I am going to go through the lists very carefully for the gems hidden by a solid clod of dirt. Rev per staff member is a good metric for many professional businesses, indeed any biz which charges for time.
But, a caveat. The staff member has no control over revenue (read pricing of the tech
/service sold). That’s managements job and they can get it horribly wrong by incorrectly positioning it in the market. A very personal example: many years ago I wrote a set of business manuals for small/medium businesses. Started selling them at $169. Did all right. Then a marketing guy said to me ‘too cheap’, the perception is they cannot be any good. Increase the price to $489, he said. Absolutely heresy to my left Bain accounting background, but I did. They sold better than at $169. Go again he said. Try $695 but throw in an annual monthly newsletter, he said. I did, and they sold more and quicker than at $489. When I sold the biz in 2007, a much enlarged set of manuals sold for $3,000. Not possible today because the internet has made information pretty well useless.
My point is management is responsible for building the perception which dictates the price which determines the revenue. I would nominate Wayne Hooper of Laserbond as being one who is underselling his tech because he hasn’t built the perception of the value of what he offers the market.
Met a yank called Harry Schulz many, many years ago. His claim to fame was that he charges $3,000 an hour for his advice. And many flocked to him. I later discovered that his guarantee was this ‘and if I don’t deliver value, I will give you an additional 10 hours absolutely free. Harry’s probably still counting his loot in heaven.
Your comments are always the best Damian. That story about the business manuals is priceless. It reminded me of some of the stories in 'Influence', the Book by Robert Cialdini (which this marketing guy may have read from the looks of it).
Robert shares this story about a clerk in a store mistakenly increasing the price of every diamond, rather than discounting them. The result is obvious of course; sales went up.
Good to see a real story supporting this theory.
You're right though that management must take ownership of this important point, and it's very difficult in general.
Thanks for reading, and your quality comments as always.
I met Bob Cialdini in Phoenix in the late 1990's. he is the real deal. Actually watched one of his experiments which he called 'priming' where a beggar was set up with a hat in front for coins. he proved they could influence the amount of the donation if they used a primer who came in from the side & put a dollar note donation in. It did influence the qantum of the donations but can't remember the pecentage increase. It was about the same time I saw a pan handler in New York with a sign 'Bad Advice - just $1"' He was doing okay, too!
I regard ''Influence'' as the best business and life book I have read and would have given away around 60 to friends and associates.
Nice one mate! I know AD8 push that employee growth drives their growth and they’re quite open with employee numbers which is useful.
Thanks mate! I think Audinate are probably a good example of a lot when it comes to reporting. The PE of 100 makes it a company that you're betting on for the long term, but I definitely understand people who make that bet.
What are you writing about next mate?
100% it’s by no means cheap but never really is!
Hopefully have an article out with Claude on your guys ACE soon. Also looking to get a short one out on Wednesday back on here. I’ve been a bit slack!
Are your next lot to articles stock specific or more like this one?
Great read. Very interesting. Could staff costs as a percentage of revenue in the half and yearly report provide more accurate results than Linkedin employee numbers?