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The Hush Reality of a Low Margin Hustle

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A low margin business is a hard long grind. That the amount it costs to make a product vs the price you selling it for.

To make real money in low margin business you have to sell and move a lot of units.

Consider a business with a 50% margin on a R10 item, to become a R10million revenue business you’d have to sell a million units.

There are then those who make around R40 to R80 per unit selling stuff like T-shirts etc… Another tough business to be in. To make a minimum of R8 000pm you need to sell a 100 shirts, to be honest I doubt most clothing streetwear boutique move a 100 units per month, so why?

Yes, you start off well, demand is high, excitement and positivity everywhere, you getting orders and money starts to come in but once the hype fades away and you start to realize just how hard it is grow to organically.

This is the problem most black companies and businesses face. Sometimes it makes sense why we are advised to write business and do projections, if not for investors but ourselves to see where this thing could lead. Numbers always tell a beautiful or horrific depressing story.

We need to start building companies with the end in mind. What do numbers say, what’s your exit strategy, how would you expand or scale and how would an investor get their money back if you take on some.

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