Business Essentials: Tracking Your Money

Activity alone does not equal growth; sustainable progress comes from knowing exactly where your money is going and how it’s working for you

Author

Team THRIVE
December 11, 2025

This blog post is a very interesting one as it marks the beginning of a three-part series on Business Essentials created to help entrepreneurs understand the basic tools and practices they cannot do without. In this series, we’ll be sharing details on three important topics: tracking your money, setting up system tools, and building business structures that support sustainable growth.

Managing a small business entails handling numerous responsibilities, including promoting your products, fulfilling orders, engaging with customers, and managing payments. In the midst of these activities, financial transactions occur constantly.

Yet, without a clear system for tracking income and expenses, it becomes difficult to understand the true financial health of your business. Activity alone does not equal growth; sustainable progress comes from knowing exactly where your money is going and how it’s working for you.

Stay locked in.

Table of Contents

Introduction

Every successful business, big or small, relies on a strong financial foundation. For small business owners, especially in Nigeria, understanding the origin and allocation of funds is crucial for achieving sustainable growth. Tracking your income and expenses gives you a clear picture of your financial position and helps you make smarter business decisions.

Start With Three Key Financial Metrics

You do not need an accounting degree to understand your business finances. Begin by tracking these three essential figures:

1. Revenue (Money In)

Record all income generated by your business, including sales, service payments, orders, or any other form of revenue. Every amount received should be documented, no matter how small.

2. Expenses (Money Out)

Keep a record of all business-related expenses such as packaging, delivery, supplies, internet subscriptions, software tools, and other operational costs. Accurate tracking helps you identify where your funds are going. No expense should escape you; document it as soon as possible to avoid forgetting it.

3. Profit (Revenue - Expenses)

This figure reveals whether your business is truly generating income or simply covering its costs without generating real growth. Understanding your profit helps you make informed decisions for growth and sustainability.

Other Key Financial Metrics to Track

Cash Flow

Tracks how money moves in and out of your business. Positive cash flow means you have enough to cover expenses; negative cash flow means you might be running low.

Gross Margin

Shows how much money you keep after paying for what it costs to make or deliver your product or service.

Formula: (Revenue – Cost of Goods Sold) ÷ Revenue × 100

Accounts Receivable (Money Customers Owe You)

The money your customers still need to pay for goods or services. Keeping track helps you follow up on unpaid bills and ensure a steady cash flow.

Accounts Payable (Money You Owe Suppliers)

The money you owe to vendors or service providers. Tracking this helps you pay on time and maintain good relationships.

Return on Investment (ROI)

Shows how much profit you make compared to what you spend or invest.

Formula: (Net Profit ÷ Total Investment) × 100

Selecting the right tools can make financial management easier and more consistent. You do not need complex software to stay organized and track your money; what matters most is choosing a system that suits your workflow and using it consistently.

Here are a few reliable options:

  • Paper and Pen: A traditional method that remains effective when used consistently and with discipline.

  • Notes App or Google Keep: Convenient for recording daily transactions and quick financial notes on the go.

  • Google Sheets or Microsoft Excel: Free, flexible, and ideal for beginners who prefer a simple digital record-keeping format.

  • Accounting Applications (e.g., Wave, Zoho Books, QuickBooks): Suitable for automating income and expense tracking, generating reports, and improving accuracy.

  • Local Business Tools (e.g., Prospa, Kippa): Designed for Nigerian small and medium enterprises (SMEs), offering tailored features for local financial management.

Closing Thoughts

Set a consistent schedule to review your business finances, dedicating 15–30 minutes weekly to update records. Your business does not need to be large before practising sound financial management; consistency is what drives growth and stability.

Choose a tool that best aligns with your business size and habits. The key is simplicity and consistency, as maintaining accurate records regularly is always more valuable than using advanced tools irregularly.

Team Thrive

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Motivational Message

Few lines to keep you motivated, going, and on top of the world

Success isn’t found in imitation. It’s built in your niche.

Follow your path, not the crowd.

Money untracked is opportunity lost.

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