How to tell stock money apart from your own money
The single most common mistake we see: a full cash box read as profit. Here is a way to separate the two tonight, on paper or in the app.
At the end of a good day the cash box feels like the clearest answer in the shop. It is full, and the shop is doing well. Both things can be true while you are still losing money.
The box is not one pot. It is three, sitting in the same place, and only one of them is yours to spend.
- Stock moneyWhat it will cost to replace exactly what you sold today. The moment a carton leaves the shelf, part of the cash that replaced it is already promised to the supplier who refills it.
- Money already owed outTransport, the boy who helped offload, rent set aside for the month, the loan instalment. It is still in the box tonight and gone by Thursday.
- What is actually yoursWhatever is left. This is the only number that tells you whether the shop is working, and it is almost always far smaller than the box suggests.
A worked evening
Take a real day. You sold ₦48,000. Replacing what went off the shelf will cost ₦36,500. You spent ₦2,400 on transport and ₦1,600 settling a delivery. The box holds ₦48,000 and every part of it feels like a good day’s work.
What is yours is ₦7,500. If you take ₦20,000 out of that box for something at home, you have not spent your profit — you have spent next week’s stock, and you will notice in eight days when the shelf has gaps and the money to fill them is not there.
The same ₦48,000, split three ways
An illustrative day built from the margins shop owners quoted to us — not an average, and your own numbers will differ
“Before, I thought the shop was making money because the box was full. Now I can see what is mine and what is stock money.”
How to do it tonight, on paper
- Write what you sold, in one numberNot item by item. One figure for the day’s takings is enough to start, and you are far more likely to keep doing it.
- Beside it, write what refilling costsYou know roughly what you pay for what left the shelf. Rough and written down beats exact and remembered.
- Subtract what you spent todayTransport, help, anything you settled from the box. Include the small ones — they are the ones that go missing.
- The number left is the only one to judge the day byDo this for a week and you will have something most shops never have: a true picture of whether the shop pays you.
Nothing here needs an app. A ruled page with four columns does it. What an app changes is that the subtraction happens every day whether or not you feel like doing it, and the week adds itself up.
Where this comes from
This is the method we saw working in shops that had never used software — written down and taught to us, not invented by us. The figures above are illustrative.
Read next
- From the road · 5 minTwo weeks in Sabon Gari: what 60 shopkeepers told us about software
- Guide · 4 minWhen is the right time to open a second shop?
Want the split done for you?
Enter what you sold and what you spent. MyKanti works out what is stock money and what is yours.
