I recently spent some time with Sean Felty from Next Tree Strategies and Greenlin Pet Resorts talking about labor. His consulting business, Next Tree Strategies, works with pet care business owners to rethink how they approach labor and how to optimize labor costs. It is the single largest expense in most pet care businesses, which makes it one of the most important areas to get right.
Labor, of course, is a topic that comes up often in conversations with operators, usually framed as a challenge or frustration. Many operators feel the impact of labor in their finances, but do not always have a clear system for managing it day to day. Sean’s perspective was practical and rooted in operating experience, especially as his business scaled to multiple locations. The takeaway was that labor is not just something to monitor after the fact. It is something that can be structured and managed proactively.
Labor starts with the schedule
One of the more useful reframes from the conversation is that labor management does not start with payroll or reporting. It starts with the schedule.
In many facilities, the schedule becomes reactive over time. A busy stretch leads to adding hours, which then become the new baseline. Managers make adjustments based on what they are seeing in the moment, and over time those decisions accumulate. Once a new level of labor is reached (through additional hiring), the gut impulse is to backfill those additional roles immediately when people leave.
Without a clear system or target, the schedule drifts. When that happens, labor becomes difficult to control, even if the team is well-intentioned. What Sean emphasized is the need for consistency at the scheduling level. That does not mean rigidity, but it does mean having a structure that defines what “right” looks like. Once that is in place, the rest of the system becomes easier to manage.
Moving beyond labor as a percentage of revenue
Most operators are familiar with tracking labor as a percentage of revenue. A good target is around 40% when accounting for total labor costs, including taxes and benefits. That metric is useful, especially as a high-level indicator.
The limitation is that it is backward-looking. It tells you how you performed, but not how to plan.
A more operational metric is labor hours per pet. Instead of asking whether labor was too high after the fact, this approach starts with a simple question: how many hours should it take to care for the pets in the building?
Once that relationship is defined, even at a rough level, it becomes possible to set expectations for managers and to build schedules that align with those expectations. Sean mentioned that many facilities end up near a benchmark of around 0.79 labor hours per pet, though this varies depending on services and operating model. The specific number is less important than having a consistent benchmark that reflects how your business runs.
Why overstaffing creates its own problems
There is a natural tendency to solve operational strain by adding people. When the day feels busy or disorganized, more coverage seems like the safest option. In practice, that approach can introduce new issues long-term if sustained over less busy periods.
Overstaffing can reduce clarity around roles and responsibilities. Tasks become less defined, and accountability can weaken as more people are involved. The result is that productivity does not necessarily improve, even though labor costs increase.
It reminded me of something my grandfather used to say:
- One boy is a whole boy
- Two boys is a half a boy
- Three boys is no boys at all
What he meant was that as more people get added to the same work without clear ownership, accountability starts to break down. One person owns the task and gets it done. With two, responsibility starts to split and effort can soften as each assumes the other will handle parts of it. With three or more, it often becomes unclear who is actually responsible, and things can stall or get missed altogether. The point is not that more people are bad, but that without defined roles and ownership, adding staff can dilute productivity rather than improve it.
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This does not suggest running lean to the point of risk. Safety and care standards should always come first. The point is that there is an optimal level of staffing where the team is both supported and accountable. Reaching that point requires more than intuition. It requires a clear target and a system for aligning the schedule to that target.
Structuring staffing around demand
Seasonality is a constant in pet care. Demand shifts throughout the year, and staffing needs to adjust accordingly. So, how do you staff when seasonality is an issue? When you’re worried about assigning hours?
These questions point to the need for having a clear framework for how different types of employees fit into your schedules.
This structure allows operators to plan more intentionally without overstaffing or creating unrealistic expectations for staff. Instead of treating all staff as interchangeable, it creates a way to match labor supply to demand patterns. Use historical data to create a forecast for future staffing so that you can be prepared.
Forecasting in this context does not need to be precise to be effective. The goal is not to predict exact pet counts, but to get close enough to make better scheduling decisions.
When expected volume is paired with a labor hours per pet target, it becomes possible to estimate how many hours should be scheduled for a given day. This creates a starting point for managers, who can then adjust based on real-time conditions.
Without that baseline, scheduling decisions are largely reactive. With it, they become more structured and easier to evaluate.
The financial impact is meaningful
Labor optimization is often discussed in abstract terms, but the financial impact is concrete. Sean shared that many operators are able to improve labor efficiency by 5% to 8% of revenue once they begin managing it more intentionally. In some cases, the impact is larger.
For a business generating $1 million in annual revenue, that range represents $50,000 to $80,000. At higher volumes, the numbers scale accordingly. These improvements do not come from cutting corners, but from aligning staffing more closely with demand and improving consistency in how schedules are built.
There is also a longer-term consideration. Labor efficiency is a key factor in how businesses are evaluated, particularly by buyers. A facility operating with a clear system and consistent labor performance is inherently more valuable than one without those elements in place. This can take your multiple from 3x to 5x in valuation when you are exiting.
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Getting started without overcomplicating it
For operators who have not approached labor this way before, the process can feel overwhelming. The starting point does not need to be complex.
A simple first step is to look at a recent period and calculate labor as a percentage of revenue. That provides a baseline that you can start and measure against. The big metrics that you’ll need are:
The goal is not to build a perfect model immediately. It is to begin understanding how labor behaves in the business and to introduce a level of structure that can be refined over time.
A more intentional approach to labor
The broader takeaway from the conversation is that labor does not need to be managed reactively. With the right metrics and a consistent approach to scheduling, it becomes possible to gain control of how labor operates within the business.
That shift changes the role of the operator. Instead of responding to problems as they arise, there is an opportunity to set expectations, measure performance against those expectations, and adjust in a controlled way. This does not remove the variability inherent in the business, but it does make it more manageable.
If you’d like to take things one step further, Sean has built a tool called Labor Lens to help operators apply these concepts in practice by connecting pet counts, scheduling, and labor targets.
You can explore a demo here: Labor Lens Demo.
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