How to Manage and Maximize Your Sari-Sari Store's Profits

How to Manage and Maximize Your Sari-Sari Store's Profits

Published on November 06, 2020 • 6 minutes read
How to Manage and Maximize Your Sari-Sari Store's Profits

It is not enough that your sari-sari store is well-paid for the time being―you must also guarantee its long-term profitability. You can achieve this goal by performing activities that effectively manage and maximize your shop’s revenues. These tasks include regular monitoring of your inventory and establishing a good budget. When your inventory is always new and complete, customers will patronize your goods. Making a budget helps you avoid overspending. With these actions, the income of your store becomes sustainable in the long run. Below are ways for you to manage and maximize your sari-sari store’s profits:

Set a Budget

List down your shop’s expenses for a given period (usually a week or a month). Besides each expense, specify the amount that you will allocate for it. You can either write your budget on a ledger or type it on a Microsoft Excel file. Once you have created your budget, be sure to stick to it. Do not buy equipment or goods that you really cannot afford simply because you saw your competitors purchasing these. If you do, you might end up reducing your money and even borrowing from other people just to be able to meet more important payments such as rent and electricity bills.

Routinely Check Your Inventory

It is important that you consistently keep track of your inventory. Failure to do so increases the chances of your merchandise expiring without you knowing it. Since expired products are no longer fit for consumption, you will have to throw these out, resulting in wasted money. Include in your tally when you purchased goods, their respective expiry dates, and the quantities you have in hand. Just like your budget, you can jot your table down in a ledger or encode it in an Excel file. Make it a point to frequently update your record so that you will know ahead of time if you already have to replenish your stocks. Learn how to start your inventory system here: Proper Inventory Management for your Sari-Sari Store

Add 10% Markup

According to, a simple method of pricing your goods and calculating your shop’s revenue is the “Rule of 10.” Add a 10% markup to each of your products to cover your overhead expenses and desired profit. For example, if you bought biscuits from a wholesaler for PHP 5 per pack, sell each unit at PHP 5.50. Similarly, take 10% of your outlet’s total daily revenue and consider this your profit or tubo. For instance, if your store earned PHP 500 today, 10% of this amount which is PHP 50 will automatically become your tubo. Do not spend your tubo broadly. Rather, save it, so that you can buy more products or equipment for your shop without going into debt. Also, you can use it for your store’s emergency expenses like roof leak repairs. For other business pricing tips, check: Stocking and Pricing Tips for Your Sari-Sari Store

Keep Your Business and Personal Funds Separate

When you keep your personal and business funds in the same bank account, you will certainly misuse money that is intended for your store. For example, you may overspend on online shopping.. Before you know it, your bank account is already empty, and you have no remaining capital. Avoid this scenario by opening a separate bank account for your business funds. Doing so guarantees that you will have sufficient money for your outlet’s operations. Ask yourself: What if Meralco disconnects my store’s electricity supply, will I be able to pay for it with my new gadget?

Do Not Turn the Goods of your Sari-Sari Store into Your Personal Grocery

Some sari-sari store owners have the tendency to turn their store’s goods into their personal grocery. Instead of selling their products, they use these for personal consumption. Not surprisingly, their store shelves are emptied even if they did not get to sell anything. With no sales, they do not make profits and their outlets eventually fold up. When you take something from your shop for personal use, be sure to pay for it like you are buying from another store. Doing so, ensures that you will have enough funds to buy new merchandise to sell and generate profits from.

Say No to Credit

Some sari-sari store customers tend to buy items on credit. They take a product and promise to pay for it in the future. However, they intentionally forget to pay for what they purchased. The proprietor, bound by the Filipino trait of pakikisama (maintaining harmonious relationships with other people), no longer bothers to go after these customers to avoid offending them. Hence, his or her inventory is reduced to the point where he or she has nothing to sell anymore. The lack of wares ultimately diminishes his or her profits, forcing him or her to close the business for good. To safeguard your store against credit-related losses, make it clear to your customers that you are running an enterprise. Anyone who buys from you must therefore pay in full immediately after a transaction. In short, credit is not allowed in your shop. This rule may turn off some of your customers, but at least you will have peace of mind because your outlet is generating profits.

Keep Operational Costs Low

Reducing your operational costs can greatly boost your revenue. To lower your electricity bills, invest in appliances with inverters. These appliances are more energy-efficient compared to those without inverters. Using inverter appliances thus cuts your power consumption and, ultimately, your electricity expenses. You should likewise buy appliances with comprehensive warranty coverage. An extensive warranty safeguards you against major out-of-pocket expenses if ever your appliance breaks down. Appliance repairs will not deplete your profits, giving you huge savings and peace of mind. The Condura Negosyo Pro chest freezers (inverter and non-inverter) provide energy-efficient chilling. The Negosyo Pro inverter chest freezer consumes less electricity than its conventional counterparts. The Negosyo Pro non-inverter chest freezers’ electricity usage is equivalent to roughly PHP 9.48 per day (based on an average daily consumption rate of 11.7088 kWh from January to June 2019). The quality of your shop inventory is hence preserved minus the huge power costs. The Condura Negosyo Pro chest freezers (inverter and non-inverter) and chillers also have a 5-year compressor warranty and a 2-year warranty on system parts and labor. Condura Negosyo Pro manual/semi-automatic defrost inverter refrigerators (single- and two-door) have a 10-year compressor warranty and a 3-year warranty on system parts and labor. The Negosyo Pro no-frost inverter refrigerators have a 10-year compressor warranty, a 3-year inverter board warranty, and a 1-year warranty on parts and service. These terms ensure that high repair prices will not consume your profits. You will get to save your earnings and use it to grow your shop instead.

Discipline Is Key

Handling your sari-sari store’s profits requires discipline. It is very easy to become unworried when your store is thriving. But complacency can cause financial mistakes that can drive your customers to your competitors. The Philippines has numerous sari-sari stores that offer goods at competitive prices―you can quickly lose your customers to these establishments merely because you carelessly managed your outlet’s revenues. Proper usage of your shop’s profits, in sharp contrast, generates more money for new investments, such as additional merchandise and equipment. These investments give your store an edge over its competitors, leading to greater business continuity for it. Condura provides various refrigerators, freezers, and beverage coolers for households and businesses. To know more about our products, call us at (02) 8863-5555 or 1800-10-888-8888 (toll-free number for PLDT subscribers) or click here.