Financial Terms Glossary

Loaded Cost

Formal

The total cost of employing a member of staff including the base salary cost. In addition to salary, other hire costs include Travel, IT, Healthcare, State Taxes, Insurance, Commission, Bonuses. In calculating the total loaded cost of a person, for investment appraisal, a good approximation is to double the salary cost.

Informal

People employed in business are expensive. For every $1 paid in base salary it costs another $1 in taxes and benefits to hire that person. When using the SHARK evaluators, loaded cost is important in investment appraisal. Estimates of total cost should therefore be 2x basic salary. Now you realise how expensive people are - investment proposals that save staff have just become twice as easy to justify than you originally thought.

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At Shark Finesse we have created business case software to help you win budget and change the way you talk to customers about business value.
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