Forecasting Wage Increases for Your Pet Business

Now more than ever forecasting wage increases for your pet business has become a reality.  The post-pandemic world is changing strategies for hiring including entry level salary rangers. In some areas minimum wage is being dictated by state policies and in other areas minimum wage increases are necessary to attract a good employee (and some places both of these things are happening). 

How do you plan to step up your wages over the next few years to keep up with these increases? 

How do you plan for the future success (and profitability) of your business despite increasing labor costs?

Knowing your numbers and forecasting your wages for the next three years is our recommended solution for both important questions. We recommend using excel as a tool to make forecasting easier and to try different scenarios. 

Our tips to forecasting wages are to take these steps:

• Divide team members into Fixed versus Variable staff members
  • Fixed are the staff you pay regardless of how many pets are served
  • Variable are the staff that provide services and will vary with volumes served 

• List current staff and their wages and calculate their current monthly pay 
• Decide how big of an increase each staff member will get in current year and month of planned increase
• Calculate annual labor costs for current year by adding number of months at current wage and number of months at increased wages
• Determine the overall increase in wages for the current year – this is the amount you will need to increase your revenues to pay for the wage increases
• Plan wage increases using the steps above for the next two years

Our video provides more details on setting up your excel worksheet and ideas on how to increase pricing to ensure your business passes on increased costs to clients.  We also share how you can use the staff forecasting data in our Pet Profits template to confirm your service rates cover your increased labor costs. If you don’t pass along these costs you’ll reduce your own pay to cover them. Pet services is not alone in facing increased labor costs so take action now to create your plan to recruit and retain the staff you need to provide excellent care quality.

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