Nothing works better than just improving your product

As an entrepreneur, improving our product or taking our business to the next level is supposed to be our biggest goal because it comes with alot of benefits. Alot of people wonder why their business is no longer booming like it used to and this is happening because they failed to follow the trend by improving or updating their products. This is a wonderful challenge about cost and I have alot of meaningful things to say.

What is cost and how important is it for entrepreneurs?

Cost is known as the amount of funds that are used to produce a product, establish a business or achieve a goal. Cost mainly has to do with capital, it is the initial expenses of an entrepreneur as he/she try their best to spend them wisely so that their business won't go down at the very beginning.

Alot of entrepreneurs really took so much time before they could gather funds as their cost in their newly established business because money isn't easy to be made and they also need to think properly and wisely, in other to ensure that they venture into the right business at the right time. We do have so many types of cost which has to do with the financial aspect of an entrepreneur, social, economical and so on.

Cost is important for entrepreneurs because it is the pillar of their business, without cost the business won't be very strong and valuable, it is also the origin of the business as it made it possible for the business to exist and keep on growing. I will love to also add that it is the power house of the business as it has alot of role to play in ensuring that the right resources for the business is always available.

Establish the difference between costs and expenses, giving examples of this through a real case.

There's definitely a difference between Cost & Expenses, as they all play their own unique role in a business because their connection is totally different. In my own belief I will boldly say that cost has to do with input because they are resources we bring in to the business to enable it to keep on growing. Expenses on the other hand has to do with output because it is the money will give out to one category or the other, just to also ensure that the business is still flowing.

Ok I will use the scenario about the field of Barbing since I learnt this skill and am a professional barber though I don't work in a salon because school will begin soon. A barber opens a barbing salon in a particular building and the money he used to pay for that space in a building for his salon is known as his cost because he used it to bring his business into existence. Without a building you can't a barbing salon.

The barber will need to put things that will make the business more possible, inside the building which is Joe his barbing salon so he will go to the market and buy alot of things like these things found in the table below 👇

Clippers	chairs	Neck paper
Towel warmer	Scissors	Comb
Hair cream	After shave cream	Mirror
Screwdriver	Clipper oil	Dye
Neck wrapper	Powder	Generator
Bulbs	Ceiling fan	Sterilizer
Detergent	Bucket	Face duster

Without 90% of these things a barber can't start his barbing salon. Expenses now exists when something goes wrong and alot can actually go wrong. If the clippers get bad or the blades are weak, the barber needs to buy new clippers or sharpen the blades. Things like the hair cream, powder, clipper oil and after shave cream will definitely finish as long as the barber is making use of them while serving his customers. He will use money to purchase new ones and that's his expenses

What are the benefits of performing a good cost determination?

Accountability: The entrepreneur will be able to account for his cost if he align everything well and works according to his plan, he needs to also keep important record of some transactions for this to be possible.

Experience: It boosts our rate of experience in the business as it makes the entrepreneur qualified for a bigger opportunity in the future. An entrepreneur is always with busy with his/her business almost everyday and it boosts their experience as they tackle everyday activities well.

Customer satisfaction: If I plan myself very well I will service my customers in a very wonderful way and majority of them will be satisfied with my service as a professional barber.

How do you determine the costs of your business? If you are not an entrepreneur, how would you do it?

Doing market research: Is very important to make a research concerning the business we want to do even if we have alot of knowledge about it. Research will give me the opportunity to know the trending things of the market so that I can adapt quickly once I begin.

Identifying my assets: I need to be able to identify and know all the necessary things required for my business to be successful so I will draft them out after identification and head to the market to get them.

Drafting out my cost: Once am back from the market I will quickly draft out my various cost, it's differences and the total amount I spent and the total amount I didn't spend. Incase you are confused, here's 👇a table of my outcome in naira.

I invite @patjewell, @m-fdo, @ngoenyi and @mcgrady to participate in this learning contest.

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