Quote from: Inwestour on Today at 10:27:28 AM

Quote from: Alpha Marine on March 22, 2023, 08:02:39 PM

I spent most of my free time with him at his shop so I know the number of customers that walk in for a haircut daily and I know what his rates are, so by calculations, he should be making enough money even after rent and other expenses required to run the shop. So one day when he complains about rent I asked him how much he makes in a week and he couldn't tell me an estimated number.

What was the problem with this barber?
If you say that he has a good flow of customers and sufficient rates to make a profit, even after paying all taxes, then why did he have no money left, what was the problem?

Some people lead such a lifestyle that only keeping records will not help them, for this you need to learn how to plan a budget. Although accounting is very important in business, and after that he will see how much he earns, but if he does not change his lifestyle, does not reduce his spending, then he still will not have enough money for rent, because his habits are costly.

He will need to improve financial planning, and after he sees where and how much he spends, he will be able to understand how much he needs for a comfortable life, and in relation to this amount he will be able to plan his budget.

It all boils down to having financial planning since it is important to track all your expenses and income so you can further assess the performance of your business. Having keeping records is one way to go since it could give you an image of the business' financial flows. I think in the situation of the barber, having personal financial planning is important since it could be a problem of how he personally manage his own money. It is important to any business and individuals to track their expenses and have financial planning so that they can really see what to do and also to view their standing in terms of financial secureness.