Hello, lovelies! I have a super post for ya’ll today. I am sharing how I divide my revenue from my business selling on Etsy! The best part about this post is that you can take these same principles and basically apply them to any home business and even your blog if you are making an income from that! Plus, there’s a freebie for you, of course! I’m sharing an income tracker worksheet you can use to track your money and where it is going!
I read this somewhere several months into my business, and I’m not really sure why the idea of investing back into my business never occurred to me, but I was thankful for this piece of advice early on in my business. The writer suggested splitting your revenue to pay for supplies, marketing, etc… Now, of course you pay for supplies either way if you have a handmade business where you create things, but otherwise you still have marketing and taxes to account for. You can split the money however you like, but I recommend starting out with dividing it into 5 categories. Income, Taxes, Marketing, Supplies, and Bill/Fees if you sell online or have regular fees or bills to pay into your business.
I started off paying a little towards my bill first thing each week, otherwise it would keep adding up until my bill was in the hundreds and I spent a few weeks scrounging to get it paid before it was due. I just take the average number for what my bill is and split it over 4 weeks. This is what I try and pay each week towards my Etsy bill/fees. Sometimes, I may have to pay less the last week, or I may have some extra at the end of the month to pay, but either way they’re taken care of and it doesn’t hit me all at once. The same goes for any business and even your blog- bills have to be paid first. For a blogger this might be hosting fees, etc…
After that’s deducted I take the rest of my revenue and divide it up like this… 60% income, 20% taxes, 10% marketing & 10% supplies. Depending on your situation you might divide yours a little differently, and that’s fine. For a handmade creative business, a large amount of your revenue will have to go back into supplies to keep making more products. You may have a week where you need to take more for your income so you scrap your marketing budget for that week, and that’s fine, too.
The point is to always do your best to make sure you are investing back into your business. Using this method you make sure you have money to invest back into marketing such as purchasing ad space, etc.. which helps your blog or business grow! Also, and most importantly, you have your taxes set aside. I’ve always heard it recommended to set aside 30% of your money for taxes, however I haven’t needed to do that up to this point. I’m perfectly okay with setting aside 20%. Plus, if you don’t owe any money or you owe less than what you’ve set aside, you can give yourself a little “tax refund” of sorts or get a head start on next year’s taxes and lower that percentage of revenue you are taking for taxes for a while.
Please know that I am not an accountant and I do not have a degree in business. This is just what I do for my little business, and it works for me. You may need to adjust the numbers, like I mentioned, to make this process work for you. However, I think that by doing this you will continue to see a return and growth with your business.
Okay, so here’s my revenue worksheet and how I use it…
Okay, so a little note, sometimes I make deposits from my Etsy Direct Checkout account and PayPal throughout the week, depending on how my bills at home fall, etc… So, I use the top part to write down my deposits, the date, and whether I sent them to the checking or savings account. My income goes to our checking account and any money for taxes, supplies, or marketing go into my savings account until I need to use it.
Then, at the bottom of the page I write my totals for the week so I can see how I did and how much I have for marketing/supplies in case I have something planned for that money.
Be sure to download your FREE copy of this printable from Google Docs!
That’s it! It’s pretty simple. Obviously, Etsy bill and taxes take priority, and marketing and supplies come last for me. It just depends on the week. I know the minimum we need to pay our bills and live comfortably and anytime I make more than that, I try to put extra into the savings account for whatever I may need it for. Now, some weeks this method can go totally sideways and not work the way I intend for it to, but that’s okay. The point is to do the best I can and make sure I’m managing my business revenue responsibly. I hope this has helped some of you home business owners out there! Be sure to stop by my shop for more organizational printables for your blog and home business!