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Workforce Cost

The Workforce Cost engine calculates the real monthly cost of every person involved in client delivery — employees, freelancers, contractors, and founders. This cost is then allocated across contracts based on real working days, using a fixed reference of 20 working days per month, ensuring accurate margin computation.
Workforce cost updates automatically whenever you modify salaries, freelance rates, or day allocations.

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What Is Workforce Cost?

Workforce cost represents the true cost of producing client work.
It includes:
  • Salaries or freelance payments
  • Employer contributions (for employees)
  • Optional overhead
  • Optional tools & equipment
  • Any monthly recurring contributor cost
This gives you a realistic understanding of how expensive it is to deliver each contract.

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Real Cost Calculation

Each person has a real monthly cost, depending on their employment type.

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Employees

Real cost includes:
  • Gross salary
  • Employer taxes & contributions
  • Optional overhead
  • Optional tools/equipment
Formula: 
real_cost = salary + (salary * charges_rate) + overhead + tools
Example 
salary = 4000
charges_rate = 0.28
overhead = 200

real_cost = 4000 + (4000 * 0.28) + 200 = €5,320 / month
Freelancers Simple and direct: 
real_cost = daily_rate * days_per_month
Example: 
450 €/day * 10 days = €4,500 / month

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Workload Allocation (Days-Based)

In Spicom, workload allocation is based on number of days worked per contract, using a fixed reference of 20 working days per month. This ensures contract-level costs reflect actual work distribution.

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How It Works

Each workforce member specifies: Their real monthly cost Days worked per contract (e.g., 5 days/month on Contract A) Total available days → always 20 days/month Spicom computes: 
allocation_percentage = days_on_contract / 20
allocated_cost = real_monthly_cost * allocation_percentage
Example A developer costs €5,320/month, and works: 5 days → Contract A 7 days → Contract B 8 days → Contract C Total = 20 days
Contract A
allocation % = 5 / 20 = 25%
allocated_cost = 5320 * 0.25 = €1,330
Contract B
allocation_percentage = 5 / 20 = 25%
allocated_cost = 5320 * 0.25 = €1,330
Contract C
allocation_percentage = 8 / 20 = 40%
allocated_cost = 5320 * 0.40 = €2,128
If Total Days < 20 Example: a designer works 15 days total this month: 5 days → Contract A → 25% 10 days → Contract B → 50% 5 unused days → internal (not billed)
Unused days dilute margin because part of the workforce cost is not allocated to client work.
Workforce Cost in the Dashboard The dashboard displays: Total Workforce Cost Allocated cost per contract Cost redistribution in simulations Impact on 12-month forecasts Everything updates automatically when you modify workforce data or contract allocation.

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Example Breakdown

Workforce MemberReal CostDays AllocatedDeliverable CostContractsCost per Contract
Developer A€5,32020 days€5,3203Distributed by days
Designer B€3,90015 days€2,9252Distributed by days
Why This Matters Because workforce cost is the biggest expense in service businesses, days-based allocation:
  • Matches real operational planning
  • Accurately reflects who works where
  • Shows true profitability per client
  • Highlights underused or overloaded staff -Supports trustworthy business decisions
Best Practices
  • Update days worked monthly or when responsibilities shift
  • Keep day allocations realistic
  • Add yourself (founder) with a fair monthly cost
  • Avoid pushing to 20 days artificially — track unused days honestly
  • Combine with Global Costs for full margin accuracy