Being self-employed with Tupperware offers you incredible financial freedom, if you manage your money right.

Chances are if you’re in the Tupperware business, you love the products! But you’re also here to make money and that’s where a cash flow projection can be invaluable. A cash flow projection is simply a forecast of the money that will be coming into and going out of your business, and it’s a great indication of the financial health of your enterprise.

Tupperware works just like your favourite shoe shop. When you hold a party, that’s when your store is open for business. The trick to good cash flow is to ensure that you have more money coming in than going out, and that there’s money on hand to pay any bills as they come in.

Three steps to great cash flow
1 Open a separate bank account for all your business-related transactions. That way, your Tupperware income and expenses don’t get muddled up with your household finances.
2 The shoe shop doesn’t let you just walk out with that gorgeous pair of stilettos if you promise to pay them sometime soon! Similarly, make sure that your customers have paid for their Tupperware orders before you deliver their purchases. If you hand over the merchandise before it’s been paid for, you’re setting yourself up for bad debt that can eat into your profits.
3 Set aside money to cover upcoming expenses. In the same way that the shoe store has had to pay upfront for all the goodies they have on display, make sure you’ve paid for your stock and also banked enough to cover other expenses like Host Gifts and income tax.

Cash flow projections in action
A cash flow projection empowers you to take charge of your business. When the shoe store owner wants to increase her income, she might open for longer shopping hours, or contact regular customers to inform them about the new winter boots now in stock. In your case, if you want to earn $500 a week and you’re making the average party income of $140, then you know that you need to have at least four parties each week. If you want to take your business to the next level, then you know that you will need to date a few more parties per week and work on recruiting new Demonstrators to step up to Managership and really see your business and income grow.

Doing a cash flow projection can also highlight areas where you can improve. For example, if you’re making less than the $140 party average do you need more orders per party, more guests, or do you need to review your party expenses? How about sending previous customers the new catalogue and giving them a follow-up call to boost your weekly orders?

Spend, spend, spend!
Once you can forecast what money you will have in your account and when, you can make educated choices on how to spend it! For instance, you may want to pay yourself a regular weekly salary, or save up for a holiday or another big-ticket item.

Alternatively, you may want to plough some of the profits back into your business. If you’re new to Tupperware, once you’ve cleared your Kit you may want to add a few additional items to build your product display.

It’s also worth setting some of your profits aside to cover the costs of future parties – things like games gifts and literature – so that your party income is covering your party expenses first. This will also encourage you to think smart in terms of how many gifts you distribute and to whom!

It’s all in the timing
A common mistake financial adviser Zuraida Ariffin has seen people make when starting their own business, is to jump in too soon, with hiring office premises or buying equipment. “If you don’t know what you’re going to earn and what you need to run your business, you can over-invest. Rather wait a while to get a clearer picture of what’s required.”

One of the great aspects of starting a Tupperware business is that you have all the support systems of a large established business behind you (a well-known brand, fantastic reliable products, marketing, IT and logistics) without requiring the financial investment or expertise required to make this happen.

Zuraida has her own business. Zuraida is an Authorised Representative of Matrix Planning Solutions. The Financial Planning Association of Australia has around 12,000 registered members. To find a financial planner, visit www.goodadvice.com.au or call 1300 626 393.