Ibukun has been running her fashion brand in Lagos for two years. She knows she should "do something" about her finances. She has bought one accounting book, started one YouTube course, and opened one spreadsheet template she found online.
None of them stuck. All of them felt like they were designed for someone with more time, more background, or a different kind of business than hers.
So she keeps running the business on feel. She knows roughly what she earns. She knows roughly what she spends. She checks her account balance before making major decisions. It has mostly worked.
But "mostly worked" is not the same as "under control." And she is starting to sense the difference.
This post is for Ibukun — and every business owner who knows they need to start but does not know where.
Most financial planning guides for business owners assume you want to become a finance professional. They introduce concepts, frameworks, ratios, and tools in a sequence that feels like a university module rather than a practical entry point.
The result: you read the first three paragraphs, feel overwhelmed, and go back to running the business on feel.
Here is what you actually need to know: financial planning for a MSME comes down to three things.
① Know your fixed monthly costs
② Know your minimum monthly revenue target
③ Track what actually comes in and goes out
That is the entire foundation. Everything else — budgets, forecasts, tax planning, pricing models — is built on top of these three. And you can set all three up in under an hour.
Your fixed monthly costs are the things you must pay every month regardless of how much business you do. They do not change whether you have five clients or fifty.
Sit down right now and list them:
This total is your survival floor — the absolute minimum your business must generate every month for you to keep operating without drawing down savings.
Ibukun does this exercise and arrives at ₦185,000. That is her number. She has never calculated it before. She has always vaguely felt it was "around ₦150,000" — she was wrong by 23%. That gap explains a lot of months that felt tighter than they should have.
Why this matters immediately: Once you know your survival floor, you know whether any given month was actually good or bad — regardless of how it felt. A month where you earned ₦350,000 feels like a success. It is a success only if your fixed costs are significantly below ₦350,000.
Your minimum monthly revenue target is higher than your fixed costs. It needs to cover:
A simple formula:
Minimum Revenue Target = Fixed Costs ÷ (1 − Variable Cost Ratio)
The variable cost ratio is the percentage of each naira of revenue that goes to variable costs.
Example for Ibukun (fashion brand):
Minimum Revenue Target = ₦185,000 ÷ (1 − 0.45 − 0.10) = ₦185,000 ÷ 0.45 = ₦411,111
So Ibukun needs to earn at least ₦411,000 per month just to cover her costs and save appropriately for tax. Any month below ₦411,000 means something is being shortchanged — either her salary, her tax savings, or her production quality.
She was not calculating this. She was looking at ₦300,000 months and feeling okay because she had paid all the bills. She did not realise she was underpaying herself and undersaving for taxes on every one of those months.
The third step is ongoing: a simple record of your real revenue and real expenses each month.
This does not require a complex accounting system. It requires:
Lucrive handles all of this in one place. When you issue an invoice, it is automatically recorded. When you upload a receipt, it is logged as an expense. At the end of the month, you have an actual vs. target comparison without building anything from scratch.
The goal is a monthly review that answers:
This review should take 20 minutes, once a month. That is all.
Once you have these three things in place — fixed costs known, minimum revenue target calculated, monthly tracking running — the rest of financial planning becomes much easier to approach.
Budgeting: You already have your fixed costs. Adding variable cost targets and income goals gives you a complete monthly budget. Lucrive's budget module builds on exactly this foundation.
Pricing: Your minimum revenue target tells you whether your current prices are generating enough. If you are consistently missing your target despite being busy, your prices are likely too low. Lucrive's pricing calculator diagnoses this precisely.
Tax planning: When you know your monthly revenue and can see your VAT collected in real time, your monthly tax obligations stop being surprises and become predictable line items. Lucrive's Tax Compliance Centre tracks this for you.
Forecasting: Once you have three to six months of real data from your monthly tracking, you have the history to build a forward-looking forecast. You cannot forecast well without real historical data — which is why starting the tracking now matters even if forecasting feels far away.
Here is exactly how to use one hour to put your financial foundation in place:
Minutes 1–15: List all your fixed monthly costs. Add them up. Write the total somewhere visible.
Minutes 16–25: Calculate your variable cost ratio (what percentage of revenue goes to materials, production, and delivery costs). Calculate your minimum monthly revenue target using the formula above.
Minutes 26–40: Sign up for Lucrive. Enter your business name, address, and basic details. This becomes your invoicing and expense tracking home from now on.
Minutes 41–50: Enter any outstanding invoices you have issued in the last 30 days. Mark any that have been paid.
Minutes 51–60: Set your first monthly budget in Lucrive's budget module. Use your fixed costs as the starting point.
You now have more financial clarity about your business than the majority of Nigerian MSME owners. Not because you have done something complicated — because you have done something simple, completely.
Many Nigerian business owners delay financial planning because they want to do it "properly." They are waiting until they have time to learn accounting, or until they can afford to hire someone, or until the business is bigger and more organised.
These conditions never arrive. The business grows in chaos and the chaos grows with it.
The version of financial planning described in this post is not perfect. It will not satisfy an accountant. It will not pass an audit on its own.
But it will give you more control, more predictability, and more confidence than you have right now — immediately, with one hour of effort.
Start imperfectly. Improve as you go.
Set up your financial foundation free at lucrive.io →
People and businesses in our examples are illustrative, not real Lucrive customers. Figures are worked examples: confirm your own position with a qualified tax adviser.