Labor
Sales per labor hour (SPLH): formula and your target
By Felix S. Pavel · Updated · 6 min read
Sales per labor hour (SPLH) is your sales divided by the hours your staff worked. It turns labor cost into a number a manager can check during a shift, not just on next month's P&L. There's no published “good” SPLH for restaurants: yours comes from your own wages and your labor cost ceiling.
The quick answer
Divide sales by the hours worked, then compare the result with your cut line: the SPLH below which labor runs over your ceiling.
SPLH = net sales ÷ labor hours worked
| Restaurant type | Cut line at $18 an hour |
|---|---|
| Quick service | $58.06 |
| Fast casual | $56.25 |
| Full service / casual dining | $51.43 |
| Fine dining | $47.37 |
| Bar, taproom or lounge | $56.25 |
Worked out from the top of each labor cost target RestaurantDoctorAI uses, at an example cost of $18 an hour in wages and payroll taxes. Not a survey: put in your own hourly cost. Work out yours with the free calculator, no sign-up.
What does SPLH mean?
SPLH stands for sales per labor hour: how many dollars of sales each hour of paid staff time brought in. If the restaurant sold $1,200 between 6 and 7 p.m. with 20 staff hours on the clock, SPLH for that hour was $60.
Labor cost percentage needs payroll, which you only see after the fact. SPLH needs only two numbers you can read mid-shift: sales from the point of sale and hours from the time clock. That's why managers use it to decide who goes home and when the next person should start.
How to calculate sales per labor hour
Net sales after discounts and comps, before tax and tips. Hours actually worked on the time clock, not hours scheduled.
- Pick the period: an hour, a shift, a day or a week. Shorter periods tell you more about the schedule.
- Take net sales for that period from your point of sale.
- Take the hours your hourly staff actually worked in it from the time clock, overtime included.
- Divide sales by hours. Count the same way every time, so this week compares with last week.
- Net sales for the day
- $3,240
- ÷ Labor hours worked
- 54
On its own, $60 says little. Next to the cut line below, it tells you whether Tuesday's schedule paid for itself.
What is a good sales per labor hour?
One at or above your cut line. We couldn't find a neutral published figure for a good restaurant SPLH, and one wouldn't fit anyway: the same $50 is healthy where staff earn $14 an hour and over budget where they earn $25. So work your line out from two of your own numbers.
Average hourly labor cost is hourly wages plus the payroll taxes on them, divided by the hours worked. It leaves out benefits and salaried pay, so aim a little above the line.
- Hourly pay and payroll taxes, last week
- $15,480
- ÷ Hours worked
- 860
- = Average hourly labor cost
- $18.00
- ÷ Full service ceiling as a decimal
- 0.35
Any hour that brings in less than $51.43 per labor hour is running labor above 35% of sales.
The ceiling is the top of the labor cost target for your type of restaurant, written as a decimal. The quick answer at the top of this page works the line out for each type at $18 an hour; see labor cost percentage by restaurant type for the targets and the National Restaurant Association's medians beside them.
SPLH vs labor cost percentage
They're the same thing seen from two sides. Labor cost percentage is your average hourly labor cost divided by your SPLH: at $18 an hour and $60 in sales per labor hour, labor is 30% of sales. That's why a cut line works.
| Labor cost % | Sales per labor hour | |
|---|---|---|
| What it divides | Pay, taxes and benefits by sales | Sales by hours worked |
| What you need | Payroll and sales | Sales and the time clock |
| When you see it | After payroll runs | During the shift |
| Best for | Checking last week against your target | Deciding who goes home this hour |
Using SPLH during a shift
Check it hour by hour against your line. One slow hour before a rush is normal. When an hour comes in under the line and the next hour's usual sales won't make up for it, that's when to make the first cut, starting with the role guests notice least.
Free calculatorWork out your cut line: labor cost calculatorLast week's payroll and sales give your line, salaried pay included, and how many hourly staff an hour's sales pay for.How to raise sales per labor hour
- Schedule to the hour, not the day: look at sales by hour for the last four of the same weekday and staff to that curve.
- Stagger start times so people arrive with the rush, and plan cuts from the end of shifts rather than adding cover late.
- Move prep, stocking and deep cleaning into the slowest hours, so those hours do work that would otherwise be paid at peak.
- Cross-train so one person can cover two stations when it's quiet.
- Lift the sales side too: a higher average check raises SPLH with the same hours.
A very high SPLH isn't always good news. If it comes with long ticket times or slipping reviews, the floor is short, and guests are paying for the saving.
Common questions
What does SPLH stand for?
Sales per labor hour: sales for a period divided by the hours staff worked in it.
Do salaried managers' hours count in SPLH?
Pick one way and keep it. Counting only hourly staff matches the decision a cut line is for, who goes home this hour. Salaried pay still costs money, so the free calculator's cut line takes it into account.
Should SPLH use net or gross sales?
Net sales, after discounts and comps, before tax and tips: the same sales your labor cost percentage uses, so the two numbers line up.
What's the difference between SPLH and labor cost percentage?
Labor cost percentage is labor cost as a share of sales, worked out after payroll. SPLH is sales per hour worked, which you can see during the shift. One is the other turned around: average hourly labor cost ÷ SPLH = labor cost percentage. See restaurant labor cost percentage for the full picture.
Targets are the ranges RestaurantDoctorAI uses, based on published US industry figures. General information, not financial, tax or legal advice.