Paul Daniel Staff asked 4 years ago
I currently run my business which is a year old now, currently sales have increased compared to when I start, I keep proper record of income and expenditure but my personal needs makes me spend as much as I earn which I know might be risky to my business.
How do I go through this, for now I can’t employ a cashier.
Edidiong Abraham Staff answered 4 years ago
Hi Paul,
There are alot of things we need to sacrifice for our businesses to thrive. Do only those things that are important. When you’re running a business some of your profit ought to go into expansion so you don’t remain stagnant in my opinion. If you can’t employ a cashier yet, learn the how to handle the book-keeping and finances yourself. Thankfully there are so many platforms to learn even for free now.
Adebukola Abadariki Staff answered 4 years ago
Hello Paul, from what I have read here, keeping records does not seem like the major issue. You seem to be spending money from your business on your personal needs. Might I advice that you work with a pre-determined percentage of your profit as your “salary”. For example 10% of your profit can be what goes into your pocket monthly, 65% goes back into the business for expansion and the remaining 25% as your reserves. You could probably hand the reserve over to financial institutions (or someone) who you trust enough and whom you cannot strong arm into giving you back until there is a dire business need for it.
Please note that you don’t have to use this figures exactly, you can work with figures you’re more comfortable with. However, whatever you decide, maintain the discipline to follow through.
As for your needs. You could create a scale of preference and attend to the most pressing needs with the resources you have at your disposal. Along the line, you might discover that you did not even not money to sort somethings out, because you have found an innovative solutions to that need.
Fred Konneh Songa Monson Staff answered 6 months ago
Hello Paul;
It’s great to hear that your business is thriving and that your sales have increased within the first year. It’s important to keep track of your finances and maintain a proper record of income and expenditure to ensure the financial health of your business.
However, it’s also crucial to separate your personal and business finances to avoid potential risks to your business. You mentioned that your personal needs make you spend as much as you earn, which can indeed be risky in the long run.
One way to tackle this issue is to create a strict budget for both your personal and business expenses. Allocate a specific amount for your personal needs and make sure to stick to it. This will help you to avoid overspending and potentially harming your business finances.
Additionally, try to find ways to increase your business revenue or reduce expenses to create a buffer for potential fluctuations in income. This could involve seeking out new opportunities for growth, cutting unnecessary costs, or finding ways to improve efficiency.
While you may not be able to employ a cashier at the moment, consider other options such as automating certain financial processes or seeking advice from a financial advisor to help you manage your finances more effectively.
Ultimately, it’s important to prioritize the financial sustainability of your business and make prudent decisions to ensure its long-term success.