How to know your real profit (not just sales)

A day where money keeps coming in feels great. But turnover isn't profit — and plenty of busy shops quietly lose money. Here's how to tell the difference.

SalesPal · updated August 2026

Sales, cost of goods, and profit

Three numbers decide whether your business is actually working:

• Sales (revenue): the money customers pay you.
• Cost of goods: what those items cost you to buy or make.
• Expenses: everything else it takes to run the shop — transport, rent, data, staff, packaging.

Your real profit is simple:

Profit = Sales − Cost of goods − Expenses

If you only watch sales, you're seeing one number out of three. That's how a shop can sell ₦500,000 in a month and still have almost nothing left.

A worked example

Say you sell 40 tins of hair cream at ₦2,500 each:

• Sales: 40 × ₦2,500 = ₦100,000
• Each tin cost you ₦1,800, so cost of goods = 40 × ₦1,800 = ₦72,000
• Transport and data for the week: ₦8,000

Real profit = ₦100,000 − ₦72,000 − ₦8,000 = ₦20,000. Not the ₦100,000 that passed through your hands. Knowing this changes what you do next — which products to push, which to drop, and whether your prices are high enough.

The one habit that makes this easy

You don't need accounting software or a bookkeeper. You need two things recorded every day:

1. Each sale — what you sold and for how much.
2. Each expense — what you spent and on what.

Record the cost price of your products once, and profit works itself out from there. The trap is trying to remember it all at month-end; by then the small expenses are forgotten and the numbers are guesses.

Do it on your phone in seconds

This is exactly what SalesPal is for. You record each sale and expense in a few taps, enter your cost prices once, and it shows your real profit — updated live — for today, this week, this month, or the year. No spreadsheets, and it works even when your network is down.