Industry sector: Retail and wholesale

Milk round: Wages


Money which you take from the business to cover your own personal living expenses is known as 'Drawings'. This should not be included here, but will be dealt with elsewhere in the cash flow.

Before you can make an estimate of the wages you will pay each month to any employees you will need to identify the work that must be done and how many people will be needed to do it.

Staff duties

You may need staff to:

  • deliver the milk. If you have a large round with many customers you may need additional roundsmen/women
  • collect payment from customers
  • work in the dairy, if you have a retail outlet
  • work in the depot, if you plan to supply other milk delivery businesses
  • do the paperwork and keep the business records

The wages you pay your staff will depend to some extent on what is the going rate in your area. The Annual Survey of Hours and Earnings (ASHE), which is carried out by the government, gives average weekly wages (national and regional) for a wide range of different types of job. The Survey is available online on the Office for National Statistics (ONS) website.

Don't forget:

  • the National Minimum Wage Act sets a minimum amount that you must pay your staff. Workers aged 25 and over receive a Living Wage premium on top of the standard National Minimum Wage
  • there is employment legislation which you should be aware of
  • you will have to pay employer's National Insurance Contributions (NICs) and you will have to operate PAYE in 'real time'. You may have to make employers' minimum contributions to an auto-enrolment pension scheme too

In the cash flow, just put the amounts you will actually pay to staff after you have deducted NICs and PAYE - you will show these separately. Also include here the cost of staff pensions.