Quote from: Fortify on Today at 06:34:27 PM

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

I had this barber friend in a neighboring hood I lived a few years ago who is a very good barber and has his own barbershop. He does home service from time to time too. He’s really good so he has a lot of customers but at the end of the month he always struggles to pay the rent of his shop. 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.
Long story short, I educated him on how to keep financial records and record every single penny that comes in and goes out of his business. I also made him understand how this can help him cut losses and make more profit.

It seems a bit weird that you had to educate this person on financial records, when it is pretty much demanded by the tax authorities in every country to have proper accounting. Otherwise you end up in a grey area which can easily be misconstrued as you trying to avoid taxes or even worse - money laundering offenses. If this person had been around for at least a couple years they should have been paying taxes and to do that, you need to know your incomings and outgoings. With that in mind, some people pay accountants to deal with the nitty gritty details, especially if they're in fields where they make a lot of money or once the company starts to expand but it is necessary to know these basics things to determine if you're making any sort of profit.

some people just earn the money and do not keep the record this damages their business and doesnt know how to deal with finances