How to Calculate the Cost of Vacancy
Understand the impact open jobs have on your company’s revenue
Calculate the costs of turnover and stem the flow of lost talent
Calculating the cost of vacancy can help you understand how open positions impact your overall revenue position and potential for profitability.
For companies growing their sales team, meeting revenue objectives can be costly enough without the added expense of employee turnover, and the vacant positions that result. In a sales organization, vacant sales positions can mean the difference between hitting revenue targets, or showing a major loss for the year. Each day a sales position remains vacant adds up to lost sales, productivity, and profitability.
If you aren’t staffing all available positions, your sales team may be stretched thin and unable to serve all your customers, ceding valuable market share to fully-staffed competitors. Managers, too, are feeling the pinch. Without a full staff, they may be covering multiple territories, leaving them with little time to manage their current team members. This overburdened team may see morale drop, resulting in more turnover and vacant positions.
Although it may seem less costly to leave a position unfilled (saving your company the hard costs of the employee’s salary, benefits, and overhead expenses), the opposite is true.
Use our simple cost of vacancy calculator to receive a high-level analysis of your current sales team, annual revenue targets, estimated turnover, and average time-to-fill. By understanding how many positions you need to fill and how long they’re staying open, you’ll see the true cost of open positions.
Need further insight? Contact us today to learn how you can improve retention and decrease your cost of vacancy.
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