🙌 MESH Biz' Class Week 4: Doing The Math Kujua Kama Biz Ina-grow
To build a successful business, you need to know how much it costs to run it.
How much you can charge, and what profit you can expect. This is the heart of your business model.
When you understand the math, you’ll know whether your idea for a biz is viable and how to grow it.
Why This Step is Important
Money matters in business. Kwa wengi wetu, if we're being honest, it's the most important part!
Bila a clear understanding of your costs and profits, ni hard ku-make informed decisions about pricing, scaling, or budgeting.
Kujua numbers zako pia hukusaidia ku-identify areas to cut costs or increase your revenue.
For this step, we want you to create a simple business model. Here's how to go about it:
Steps to Create Your Business Model
List Your Costs
Write down everything it takes to run your business—materials, transport, fees, utilities, and even your time. Include both fixed and variable costs.
Define Your Pricing
Decide how much you’ll charge your customers for your product or service. Make sure it covers your costs and leaves room for profit.
Calculate Your Profit
Subtract your total costs from your total revenue. This gives you your profit—the money you’ll take home.
Remember James and Wambo? Let's look at their business models:
1.James
What are your costs?
Rice, cereals, vegetables, cooking oil, spices. charcoal for boiling cereals. KSh 40 per meal × 50 = KSh 2,000 KSh 300 daily.
Disposable lunch boxes and cutlery. KSh 15 per container × 50 = KSh 750.
Helper/ Employee KSh 500 daily
Transport: KSh 200 daily.
Phone credit and data: KSh 100 daily.
City council fees: KSh 50 daily.
What do you charge?
50 lunches at KSh 150 each TOTAL: KSh. 7500
paid via my MPESA pochi la biashara account
Profit
KSh. 7,500 - KSh. 3,900 = KSh. 3,600 daily
2.Wambo
What are your costs?
Internet/Data: KSh 400/week. Phone credit: KSh 250/week. Laptop repayment: KSh 500/week. TOTAL: Ksh. 1,150
What do you charge?
Standard Poster: KSh 500 - 1,000. Premium Poster: KSh 1,500.
Assume selling 5 Standard Posters and 1 Premium Posters per week: Revenue = (3 × KSh 500) + (2 × KSh 1,000) + (2 × KSh 1,500).
Profit
KSh 6,500 - KSh 1,150 = KSh 5,350 per week
Assignment
1️⃣ Download the Business Model Worksheet (linked below) na ujaze details zako.
2️⃣ Calculate your:
3️⃣ Total costs.
4️⃣ Revenue.
5️⃣ Profit.
👉 Download the Worksheet Here
Ukimaliza, please share customer profile yako with us on socials, FB, X, Instagram!
COMING UP
Next week, tuta-put biz zetu to the test, finding out what works and what we need to improve.
Kama uli-miss week 1, cheki hii article: Find Your Zone: Lessons from the MESH Biz Class Week 1 🌐🚀
Kama uli-miss week 2, cheki hii article: Find Your People: Lessons from the MESH Biz Class Week 2 🌍🔍
Would you like to join the biz class and receive notifications each week, please sign up here!!