How to keep the books of a beauty or service business

Why keep the books even if your business is small

When you get paid in cash, by transfer and by card, business money quickly mixes with household money. At the end of the month it's hard to know how much you sold, how much you spent on materials and how much you really earned.

Keeping the books lets you answer three questions at any time: how much did I sell?, how much is mine? and how much is left for the business?

Step 1: record every sale the same day

What isn't written down gets forgotten. Record each sale as soon as you finish the service or, at the latest, at the end of the day. For each sale, write down:

• The date and the client.
• The services or products and their price.
• The tip, if any.
• The travel fee, if you charged one.
• How you were paid: cash, transfer or card.

Step 2: split the money into three parts

Not everything you charge for services and products is profit. One part has to buy materials again, another is your pay for the work and another is for the business. A simple way is to split each sale with fixed percentages:

• Supplies: to restock materials (for example, 20%).
• Your pay: what you earn for the work (for example, 50%).
• Business profit: savings for equipment, emergencies and growth (for example, 30%).

With those percentages, from a $100 sale, $20 goes to supplies, $50 to your pay and $30 to the business. If your materials are expensive or the business is your main income, adjust the percentages. The guide how to separate business and personal money explains how to do it in practice.

Step 3: keep tips and travel fees separate

A tip is a gift from the client to whoever served them: it adds to your earnings, not to what gets split. The travel fee covers transportation and time on the road, so it shouldn't be mixed with the price of the service either. If you mix them, your numbers look better than they are.

Step 4: review your numbers once a week

Ten minutes a week is enough. Look at:

• How much you sold and how many sales you made.
• How much you earned: your pay plus tips.
• Which services sell the most.
• Which clients haven't come back.

If a week is slow, you see it in time to run a promotion or message your clients, not at the end of the month.

Notebook, spreadsheet or app: which to use

• Notebook: free and easy, but you add up by hand, it gets lost or wet, and it's hard to see the whole month.
• Spreadsheet (Excel or Google Sheets): it adds up for you and makes charts, but you have to build it and it's awkward on a phone between clients.
• App: you record a sale in seconds on your phone and the totals, split and statistics are done for you. Rentablo is free and does exactly this: it splits each sale between supplies, your pay and profit, and keeps your clients and appointments.

What matters isn't the tool but using it every day. Pick the one you'll actually use.

Common mistakes

• Counting everything you charge as profit.
• Paying household bills with the supplies money.
• Recording only the big sales.
• Not paying yourself a salary and taking money “when needed”.
• Only looking at the numbers when something goes wrong.

Frequently asked questions