Record expenses on the day they happen
Small expenses are easy to forget. Transport, airtime, packaging, repairs, cleaning supplies and staff-related costs can add up quickly.
Use clear categories
Keep categories simple enough to use consistently: rent, utilities, transport, wages, commissions, supplies, marketing, repairs and other operating costs.
Keep business spending separate
Mixing household and business spending makes profit difficult to understand. Even when money comes from the same mobile wallet, record the business purpose clearly.
Review expenses against gross profit
Expenses should not be studied in isolation. Compare them with gross profit to understand what the business truly kept.
A useful monthly question: After cost of sales and operating expenses, what did the business actually make?