2004 Best Practices Study

AGENCIES WITH REVENUES BETWEEN $500,000 AND $1,250,000

EXPENSE ANALYSIS A.

Expenses Analysis (as a % of Net Revenues)

EXECUTIVE PERSPECTIVES

+25% Profit

+25% Growth

Average

Compensation Expense Total Payroll

46.9% 8.7% 55.6% 1.3% 1.5% 1.4% 4.1% 3.5% 1.2% 0.8% 1.3% 0.8% 0.5% 1.6% 0.7% 0.6% 0.2% 0.4% 1.4% 0.5% 1.3% 0.1% 2.2% 0.2% 0.9% 0.7% 4.1% 14.8% 78.6% 21.4%

40.2% 7.2% 47.4%

47.4% 10.1% 57.5% 2.5% 1.1% 1.3% 4.8% 3.1% 1.2% 0.8% 1.3% 1.0% 0.4% 1.5% 0.8% 0.9% 0.3% 0.5% 1.6% 0.3% 0.0% -2.5% 3.5% 0.2% 0.5% 0.0% 1.7% 13.8%

Benefits

PROFILE

Total Compensation

Selling Expenses

T&E/Conventions

0.5% 1.1% 1.3% 2.8% 2.7% 1.1% 0.7% 1.4% 0.7% 0.8% 1.4% 0.4% 0.2% 0.1% 0.1% 1.1% 0.5% 0.2%

Automobile

Advertising/Promotions

Total Selling

REVENUES/ EXPENSES

Operating Expenses Occupancy

Telephone

Postage

Supplies/Printing

FINANCIAL STABILITY

Dues/Subscriptions/Contributions

Taxes/Licenses

Insurance

Professional Fees

Equipment Rental/Maintenance

Bad Debts

EMPLOYEE OVERVIEW

Outside Services

Information Technology Education/Training

Miscellaneous

Total Operating

11.5%

PRODUCER INFO

Administrative Expenses Amortization

-2.8% 1.9% 0.1% 0.2% 0.0% -0.6% 61.1% 38.9%

Depreciation Officer-Life

Interest

SERVICE STAFF INFO

Other

Total Administrative

Total Expenses Pre-Tax Profit

.4 77.8%

22.2%

TECHNOLOGY

60%

Average

50%

+25% Profit

40%

+25% Growth

INSURANCE CARRIERS

30%

20%

10%

% Total Net Revenue

0%

APPENDIX

-10%

Compensation Expense

Operating Expense

Administrative Expense

Selling Expense

40