Guides · 7 min read
Why is my business not making profit? Where your money is going
Most small businesses that sell well but have no money are not losing it all at once. It is leaking to six places: customers who have not paid, stock sitting on the shelf, prices that did not rise when costs did, small costs nobody wrote down, money taken home, and stock that went missing. Check each one with the steps below, starting with your last full month.
Step by step
First, check if it is profit or cash
Work out last month’s profit: sales, minus what those goods cost you, minus running costs (our profit guide shows how). If there is a profit but no money, the money exists, it is just somewhere else. If there is no profit, the problem is your prices or your costs. The next steps find which.
Add up what customers still owe you
Every sale on credit is profit you have not collected. Add up what each customer owes. Many owners are surprised: a few customers owing a little each can hold a week of sales. Our guide to collecting what customers owe shows how to get it back without losing them.
Look at what is sitting on your shelf
Money spent on stock that has not sold is not lost, but you cannot spend it. Walk your shelf and note anything that has not sold in a month. Buy less of it next time, and sell what you have, even at a small discount, to turn it back into money.
Check each price against what it costs you today
If your supplier raised prices and you did not, your profit shrank on every sale. Moniepoint’s 2025 report on Nigeria’s informal economy found that 79% of businesses saw their costs rise, but only about half saw their profit rise. For your top ten items, write today’s cost next to your selling price. Any item where the gap has shrunk needs a new price (see how to price your product).
Find the small costs nobody wrote down
Transport, data, POS and bank charges, nylon bags, the boy who carries load, the levy collector. Each is small, but together they can take a large part of a month’s profit. For one week, write every cost, even ₦200. Then you can see them.
Write down what you take home
Food, school fees and family needs taken from the shop drawer are real money leaving the business. That is normal, but it must be written down. If you take more than the business makes, it shrinks every month. Pay yourself a fixed amount instead (see keeping business and personal money apart).
Count your stock and compare it with your records
Count your main items and compare them with what your records say you should have. If goods are missing, they were sold and not written down, given away, damaged, or taken. Counting once a week stops a small leak from becoming a big one (see tracking stock).
An example: ₦500,000 in sales, and no money to restock
Amaka sold ₦500,000 of goods at a provisions stall in October, but had almost nothing left to restock. Here is where the money went:
- Sales in October₦500,000
- What the goods she sold cost− ₦310,000
- Running costs (transport, data, POS charges, levy)− ₦38,000
- Still with customers who bought on credit− ₦85,000
- Extra stock bought that has not sold yet− ₦45,000
- Taken home for the family− ₦12,000
Left in hand₦10,000
Amaka made a real profit of ₦152,000 in October. But ₦85,000 of it is with customers, ₦45,000 is on the shelf, and ₦12,000 went home, which leaves ₦10,000. The business is not failing. Collecting the ₦85,000 is her fastest way to have money for restocking.
Do this today: Write down who owes you money and how much, and add it up. Then compare today’s cost of your three best-selling items with their selling prices.
Questions owners ask
Why do I have sales but no money?
Usually because the profit is somewhere else: with customers who bought on credit, in stock that has not sold, or taken home. Work out your profit first, then check those places one by one.
How do I know if my business is losing money?
Take a full month. Subtract what the goods you sold cost you and all your running costs from your sales. If the result is below zero, the business is losing money, even if there is cash in the drawer.
Should I raise my prices if my costs went up?
Compare each item’s selling price with what it costs you today. If the gap no longer covers your running costs and a profit, the price needs to change. Our pricing guide shows how to work it out.
Clara can do all of this for you
Clara keeps every sale, cost and debt as you tell her, so your profit and where your money is are always worked out. Ask "Where did my money go this month?" or "Who owes me?" and she answers from your own records.
Who owes me money?
ClaraThree customers owe you ₦85,000 in total. Kelechi owes the most: ₦38,000, for 13 days.