WHY INVESTING IN YOUR BUSINESS IS NECESSARY FOR REVENUE GROWTH

 As an English teacher and a professional baker, I've not always been intrigued by the world of numbers. However, something intriguing happened as I met my old friend, Bintu, a seasoned financial analyst and accountant. She paid a visit to my shop and in the line of our discussion, she had access to my financial records and saw that my business was failing due to poor sales . She began to show me some basic accounting principles that I needed to apply in business, preparation of my financial statements and other accounting reports. As I was learning, I discovered that these principles ain't just accounting principles, but are such that would also apply to life itself in order to be successful.

 I am Ajibola, a seasoned English teacher and a talented baker who has just opened her own bakery. I am passionate about creating the most scrumptious pastries and cakes, but I was struggling to make ends meet because I was not generating enough sales and not making enough profit for myself so I could invest in my business. My bakery was hemorrhaging my hard earned money, and honestly, I didn't know why.

My old friend, Bintu, who came to visit me at my bakery, offered to help review my finances, and introduced me to the concept of revenue and costs. "Revenue," she explained, "is the financial yield of your business. It's the money you make from selling your delicious treats." My eyes lit up as I realized on a deeper level that every sale I made was a form of revenue to my business. Then she continued "Costs, on the other hand, are the prices you pay to manufacture or buy the ingredients for your products." My face fell because I don't like spending and she made me realize that every ingredient I bought, every hour I spent baking, and every rent payment was incurring a cost; this made my stomach twitch in the wrong direction. "It's like the 'no pain, no gain' adage," she said. "You can't make revenue without incurring some costs. But the key is to make sure your revenue exceeds your costs, so you can turn a profit." My eyes widened as the penny dropped. I realized that I had been focusing too much on keeping costs low, without considering the impact on my revenue. I had been using cheap ingredients, which affected the quality of my products, and I had not been marketing my bakery effectively, which meant I wasn't attracting enough customers. 

With a newfound determination, I set out to revamp my business with my friend's help. She ensured that I started using higher-quality ingredients, which invariably increased my costs but also improved the taste and appearance. She also ensured that I invested largely in marketing, by creating a social media buzz around my bakery and offering discounts to loyal customers. To be honest, it was not easy, nor was it stretchy to get myself and my business out of our ‘uncomfortable’ zones of low sales. There were times I doubted myself. But my friend kept reminding me that my stretching is part of the cost I needed to incur to boost my revenue and sales. So I persevered, and slowly but surely, my revenue began to increase. I started to attract more customers, who were willing to pay a premium for my high-quality and tasty bakery products.

As the months went by, My bakery became the go-to destination for foodies in town. I was making a profit, and my friend and I were proud of what I had achieved. I couldn't have done it without my friend who helped me to understand the concept of revenue and costs. She told me, beaming with pride. "It's not just about numbers; it's about making smart decisions that drive growth and profitability." I too was also proud of myself that I worked up myself to come out of being afraid of incurring more cost in my business. I smiled, knowing that I had learned a valuable lesson that “the principle of revenue and costs is not just an accounting concept; it's a life principle that can be applied to any situation. It's about understanding that nothing comes for free, and that every decision has a cost and a benefit”.

As I grew in the industry, I was called upon to share my story with other entrepreneurs. And as my story spread, it inspired other entrepreneurs to take a closer look at their finances. They realized that by understanding the delicate balance between revenue and costs, they could make informed decisions that would drive growth and profitability.