Utilization Rate

The utilization rate allows you to track how much you use something.

You're a connoisseur of nose hair grooming. You have a display case full of nose hair clippers. Most are collectors' items or just for display...you know, so you can impress your fellow nose-grooming hobbyists.

You want to figure out the utilization rates for each of your main clippers. That way, you can report the numbers for the fans of your blog, "The Sniffer Snipper." There are three clippers that you use for day-to-day nostril curation. Monday through Thursday, you use the Cliptastic 5000. It’s an industrial model originally developed during the Cold War to close the nose hair gap with the Soviet Union. It gets the job done efficiently without much wear and tear. Perfect for the work week. Friday and Saturday, you use the Chic Shaper X9. Popular with Instagram models and French politicians, it gives a much finer, more alluring cut. Perfect for date night or clubbing with your crew.

Sunday requires a more demure cut. Something more reflective, more relaxed. It’s time for the Whiff Whisper Blue. It provides a slow, comfortable trimming experience.Those are the clippers you use on a regular basis. Time to determine utilization rates. You use the Cliptastic 5000 four days a week: Monday, Tuesday, Wednesday, and Thursday. There are seven possible days. So utilization rate is 4 divided by 7...or 57%. You use the Chic Shaper X9 two days a week. Friday and Saturday. Two out of seven: that's about 29%. The Whiff Whisper only gets used one day a week. One out of seven. Utilization rate is about 14%.

In real life, businesses can use the utilization rate to see how efficiently they’re using their resources. They can figure out how much they operate equipment to see if they have additional slack to ramp up production. Or they can use it as an employee evaluation tool. By looking at a worker’s utilization rate, a company can see if their employees' time is getting applied effectively.

You start a nose clipper consultancy business to take advantage of your vast knowledge of the industry. You contract your services to manufacturers to test their products and advise them on various high-level clipper-related problems. You work 40 hours a week.

But only 22 of those hours are paid, billable hours working for clients. The rest of the time, you're working on marketing...and watching YouTube videos about the history of nose hair. So 22 of 40 hours working with clients. That's a utilization rate of 55%.

Probably some room for improvement. Maybe it's time to switch to the Chic Shaper for work days...it’ll get you that more impressive cut for client meetings. And hopefully you’ll be able to jack up those billable hours. Increase the utilization rate for the Chic Shaper to 86%...pretty much every day but Sunday.

Then maybe you can get your billable hours utilization rate above 60%. After all, a few more clients...and then you can afford a few more collector clippers for the display case. Like the clipper Lincoln used before giving the Gettysburg Address. Or the clipper that Neil Armstrong took to the moon. One small clip for man...