3 Ways to Know If Your Business Is Actually Making Money

Your business is making sales. Money is coming into your MoMo account. Customers are buying. But do you actually know if your business is making a profit?

This is one of the biggest questions many small-business owners struggle to answer.

You may look at your MoMo balance and think:

“I made good money this month.”

But there is a big difference between money coming into your business and profit earned by your business.

Let’s look at a simple example.

Imagine you run a small provisions shop in Ghana. Throughout the month, customers pay you through MoMo, bank transfers and cash. At the end of the month, you check your MoMo account and see that GH¢5,000 has passed through your business.

It feels like a successful month.

But before you celebrate, you need to answer three important questions.

1. How Much Did You Actually Sell?

The first step is to know your total sales.

Let's say your business made:

GH¢5,000 in sales this month.

Don't rely on memory or simply look at your MoMo balance.

Your sales may have been received through several channels:

  • MoMo

  • Bank transfers

  • Cash

  • POS payments

  • Other payment methods

Add them together and determine exactly how much your business sold.

For example:

MoMo: GH¢2,800
Bank: GH¢1,500
Cash: GH¢700

Total Sales = GH¢5,000

This gives you your starting point.

But sales alone don't tell you whether your business is profitable.

2. How Much Did It Cost You to Make Those Sales?

Now comes the part many business owners overlook: business costs.

Suppose your business spent:

  • Stock: GH¢2,500

  • Transport: GH¢300

  • Delivery: GH¢200

  • Other business expenses: GH¢300

Your total costs are:

GH¢2,500 + GH¢300 + GH¢200 + GH¢300 = GH¢3,300

So although your business brought in GH¢5,000, you didn't actually keep all GH¢5,000.

A large portion of that money was used to operate the business.

This is why tracking expenses is just as important as tracking sales.

3. What's Left After Your Business Costs?

Now let's put the numbers together.

Sales: GH¢5,000
Business costs: GH¢3,300

GH¢5,000 − GH¢3,300 = GH¢1,700

That gives you a much clearer picture.

Your business generated GH¢1,700 after the costs included in this simple example.

And this is where bookkeeping becomes powerful.

Instead of saying:

“I think I'm making money.”

You can say:

“My business generated GH¢5,000 in sales, my recorded costs were GH¢3,300, and GH¢1,700 remained after those costs.”

Now you're making decisions based on numbers rather than assumptions.

But Wait… Is Your MoMo Balance Your Profit?

No.

This is one of the most important things every small-business owner should understand.

Imagine you have GH¢5,000 sitting in your business MoMo account.

It doesn't automatically mean you made GH¢5,000 in profit.

Some of that money may be needed to:

  • Buy more stock

  • Pay suppliers

  • Pay workers

  • Cover transportation

  • Pay rent or utilities

  • Settle other business obligations

  • Reinvest in the business

Your cash balance tells you how much money is currently available in an account.

Your profit tells you how much your business earned after accounting for its relevant costs and expenses.

They are not the same thing.

A Simple Habit That Can Change Your Business

You don't need complicated financial reports to start understanding your business.

Begin with three numbers:

1. SALES

How much did the business sell?

2. COSTS

How much did the business spend to operate and generate those sales?

3. WHAT'S LEFT

What remains after the relevant costs?

Do this consistently every month and you will start seeing patterns.

You may discover that your sales are increasing but your expenses are increasing even faster.

Or you may discover that one product is much more profitable than another.

You may even realize that your business is generating good sales but leaving very little money after expenses.

That's the kind of information that helps you make better business decisions.

Don't Just Track the Money. Understand It.

A business can have customers, make sales and have money moving through its MoMo account—and still struggle financially.

The solution isn't simply to make more sales.

You need to understand where your money comes from, where it goes, and what your business is actually keeping.

That's where proper bookkeeping comes in.

At BookkeepIT, we help small and growing businesses organize their financial records so they can move from guessing to knowing.

Because when you can clearly see your numbers, you can make better decisions.

Track It. For Clarity. To Grow.

Follow BookkeepIT for practical bookkeeping, financial management and business tips for Ghanaian SMEs.

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