Expert: Arthur Naman - 5/20/2009

Question
What % of my business payroll should my monthly gross be?  If my company makes $900,000 per month gross, how much of that should go to payroll.  How do I know if too much is going to payroll?  Is there a formula?

Answer
There is no specific answer to your question.

For certain industries, there are guidelines, but nothing is specific. Also, since your business is as small as it is, the normal guidelines available that I have seen work for "small" businesses of several million in gross sales.

A better question might be whether or not the wages are in line for people with the skills you need. Are you over- or under-paying for the skills needed.