How Much Should You Really Spend On Your Team?

One of the biggest expenses in any small business is your team, but how do you know if you're spending the right amount? In this episode of The Profit Pillars Show, Parker Stevenson (CEO of Evolved Finance and author of Profit Pillars) breaks down how to analyze your labor costs, what healthy payroll percentages look like, and how to tell if your team expenses are hurting your profits. Parker explains why labor is one of the four key Profit Pillars, what benchmarks to use for online and service-based businesses, and how to separate your own salary from your team's costs to get a clear financial picture. He also shares how pricing, offer structure, and operational efficiency all affect your labor ratio and why tightening systems can often save more than cutting payroll. By the end of the episode, you'll understand how to evaluate your team expenses, set realistic payroll goals, and make smarter decisions about hiring, pricing, and profitability. If you've ever wondered whether your payroll is too high, or how to build a team without shrinking your margins, this episode is for you.  0:46 Why team spending has the biggest impact on profitability 1:33 How modern online businesses rely on teams to scale 4:39 Ideal labor-cost percentages for online vs. service businesses 7:21 How to calculate your labor ratio 8:09 Questions to ask if labor feels too high 10:14 How owner payroll affects your true labor costs 11:44 One-time projects vs. monthly contractors 12:57 How pricing impacts your ability to hire profitably 14:13 Why too many offers inflate expenses 16:06 When marketing overload spreads your team thin 19:38 Overpaying for roles that don't add revenue 23:19 Contractors vs. employees: which model lowers costs 25:00 The hidden downside of profit-sharing 26:49 How better systems reduce the need to overhire --------------- 🔔 SUBSCRIBE Subscribe to The Profit Pillars Show for new episodes on money, operations, and strategy designed to help you grow your online or modern small business with confidence. --------------- 📘 Resources & Links From This Episode 📘 Profit Pillars Book → https://evolvedfinance.com/book 💼 Learn more about Evolved Finance → https://evolvedfinance.com/services 📚 Finance Tools & Courses → https://evolvedfinance.com/learn --------------- 📌 About the Show The Profit Pillars Show by Evolved Finance gives entrepreneurs the guidance and clarity they wish they had sooner. Each episode delivers actionable advice based on Parker's years of experience helping business owners grow stronger, more profitable businesses. --------------- 🤝 Other Ways to Connect with Us 📸 Instagram → https://www.instagram.com/evolvedfinance/ 💼 LinkedIn → https://linkedin.com/company/evolved-finance 🎧 Listen on Spotify → https://open.spotify.com/show/6ggjihbD5VfKhhjkth32pZ