Cost of start up
Attached is a simplified version of the start up costs. The biggest things to note are that Oli did most of the work, working at a very discounted rate and I was able to pay him back once the business started making money. We also mostly worked with second hand equipment and materials and many of the systems where upgraded within the first 5 years.
I also wrote this blog about this early on.
Annual finances
I’ve listed a summary of each years finances as well as a more detailed spreadsheet. It’s mostly a standard Profit and Loss however I’ve added my wage and loan repayments to Oli and I which if I was running as a company rather than sole trader would be considered expenses. As it’s the running costs not the investments I’ve added in the notes the big purchases I made in that year to reinvest the ‘profit’ in the business.
2020-2021
| Summary of 2020-2021 year. | |
| Average milk litres per day | 58 |
| Income per ltr of milk | $5.07 |
| Expense per ltr of milk | $3.60 |
| Business profit per ltr of milk | $1.47 |
| Feed costs/Product sales | 22.35% |
| Wages(including Tessa)/Product sales | 15.96% |
| HOFC Fee/Product sales | 15.58% |
Notes for 2021-2022:
- All sales were made through HOFC, meaning all expenses directly related to sale (market expenses, NASAA certification) where covered in the HOFC fee
- One casual staff member for one half day a week (milker)
- COVID cash flow boost received
- Tessa wage goes from $50 a week for the first half to $100 a week.
- Big purchase; installing the wood furnace.
Detailed running cost for 2020-2021
2021-2022
| Summary of 2021-2022 year. | |
| Average milk litres per day | 63 |
| Income per ltr of milk | $6.22 |
| Expense per ltr of milk | $4.72 |
| Business profit per ltr of milk | $1.49 |
| Feed costs/Product sales | 17.82% |
| Wages(including Tessa)/Product sales | 10.46% |
| HOFC Fee/Product sales | 6.71% |
Notes for 2021-2022:
- Shared coop sales (weekly market and farm shop) were made through HOFC, meaning all expenses directly related to those sales (market expenses, NASAA certification) where covered in the HOFC fee.
- One casual staff member for one half day a week (milker (Bridget went on maternity leave and was replaced by Mel))
- Tessa wage goes from $100 a week for the first half to $200 a week.
- Start repaying Oli for the build.
Detailed running cost for 2021-2022
2022-2023
| Summary of 2022-2023 year. | |
| Average milk litres per day | 51 |
| Income per ltr of milk | $5.22 |
| Expense per ltr of milk | $4.69 |
| Business profit per ltr of milk | $0.54 |
| Feed costs/Product sales | 22.73% |
| Wages(including Tessa)/Product sales | 31.99% |
Notes for 2022-2023:
- All sales went directly through SFC, sales expenses (cost of running market) moved back into SFC. NASAA certification still covered in the HOFC fee.
- Two casual staff member for half day a week each (one milker, one production)
- Tessa wage stays at $200 a week.
- This was a very rough year, emotionally and financially. With the loss of Olive and other factors milk quantity was down significantly.
- Big purchase’s: built a hay shed, electrify dairy ute ‘Bert’, roller mill for crushing grain.
Detailed running cost for 2022-2023
2023-2024
| Summary of 2023-2024 year. | |
| Average milk litres per day | 73 |
| Income per ltr of milk | $5.37 |
| Expense per ltr of milk | $4.43 |
| Business profit per ltr of milk | $0.93 |
| Feed costs/Product sales | 17.82% |
| Wages(including Tessa)/Product sales | 23.86% |
Notes for 2023-2024:
- Milk increase as we hit 10 milkers
- Two casual staff member for half day a week each (one milker, one production), increase to Three at the end of financial year.
- Tessa wage increases to $300 a week.
- No HOFC fee this year as most costs move directly to individual businesses.
- I’ve also listed a break down of what’s included in ‘sales’ and ‘feed’ at the end of this report.
Detailed running cost for 2023-2024
2024-2025
| Summary of 2024-2025 year. | |
| Average milk litres per day | |
| Income per ltr of milk | $ |
| Expense per ltr of milk | $ |
| Business profit per ltr of milk | $ |
| Feed costs/Product sales | % |
| Wages(including Tessa)/Product sales | % |
Notes for 2024-2025:
- Milk finally hits 100ltrs, for a few weeks.
- Three casual staff member for half day a week, one casual after school staff member.
- Tessa wage increases to $400 a week.
- Paid off Oli for all his work to date and started repaying personal start-up loan
- Spent much more than usual on hay.