Click here to watch the recording of the session from 17 Feb 2024
Read: Seystitches in Accra, Ghana specializes in styling, designing, and sewing clothing for all occasions. The owner, Josephine, had very specific goals when she pitched her business on Shark Pond.
Josephine told sponsors that if given a microloan she would purchase an Industrial Sewing Machine (for $265), a knitting machine (for $371), and expand her shop space and utilities to power new machines (for $364). She provided photos of the machines and a bid from a contractor to do the construction work. This helped sponsors feel confident in her plans. She explained that the new machines would enable her to sew a dress 3 times as fast. The knitting machine would save 1 to 2 hours waiting in long lines to use a rented one for finishing each dress. With these new machines she could make an additional $400 per month, tripling her revenue and increasing profit margins from 9% to 67% even after adding to employee salaries to handle the additional work (see below).
Discuss: Why does it help sponsors feel confidence in your business when you use words like Revenue, Cash Flow Statement, and Profit Margin when describing your business to them?
Discuss: Why is it helpful for sponsors to see your Revenue & Expense Logs and Income Statement when choosing who they want to sponsor?
Entrapov Income Statement Template
You will need to create an income statement like the one shown shown below to help sponsors understand your business. Income statements help sponsors decide which business they want to support.
Fill in the income statement on the following page with information about your business. Month 1 is the first month you started selling your products or services. Fill out the form below using as many months of sales history as you have. If you have only been selling simple test products during this self-reliance course, add your weekly sales numbers to the chart below as if they were monthly numbers.
Below are numbers from Dalisey’s Virtual Assistant business. During 1 week she earned $30 from 10 orders made by her American clients. Her average order size is $3. She spent $6 in expenses from herself-salary, raw materials (commissions paid to Fiverr.com for referring clients to her), advertising, transportation, and other. So her average expenses per order are $0.60 ($6 divided by 10 orders = $0.60 in expenses per order). Her net income is $24 ($30 revenue minus $6 expenses). Her profit margin is 80% ($24 net income divided by $30 revenue).
Homework
Ⓐ Record a pitch video to introduce yourself to potential sponsors. The video should:
- Show your face looking at the camera
- Say your name, where you live, the name of your business, and what problem your business solves for your customers
- Explain what your product is and how it works
- Explain how you will use the grant money if you are given a grant
- Thank the sponsors for their consideration
- Think about what the sponsors might want to know about you based upon what we learned in this week’s lesson
Ⓑ Gather photos of yourself and your business that can be sent to Entrapov sponsors with your video.
Ⓒ I will continue to use a revenue and expense log every day to track the sales and expenses from my business.
Pingback: Chapter 9 -