The Orders Look Profitable, So Why Is This Tailor Always Short of Cash?

Priya runs a small tailoring business from her home in Kuala Lumpur. Her order book is often full, especially before festive seasons. Customers pay deposits, fabric arrives and her sewing machine runs late into the night.

Yet Priya regularly struggles to buy materials for the next batch of orders. The problem is not a lack of customers. It is the way deposits and job costs are recorded.

A deposit is money for unfinished work

A customer orders a custom outfit for RM240 and pays a RM120 deposit. The cash appears in Priya’s account, so it feels like income she can spend. But the order still carries several costs:

• Fabric and lining: RM72
• Zip, buttons and thread: RM14
• Embroidery work: RM28
• Priya’s sewing time: RM60
• Allowance for one alteration: RM12

The total cost is RM186. If Priya spends the deposit on household needs before buying the materials, she must use money from another order to finish this one.

Busy work can hide a cash flow gap

Priya used to record the full RM240 sale when the deposit arrived. That made the month look profitable even though half the payment had not been collected and some work was still incomplete.

She changed her record into three simple stages: deposit received, costs paid and final payment collected. Each order received its own line in her notebook. She could finally see which jobs were waiting for materials, which customers still owed money and how much cash was safe to use.

Record alterations before setting a price

Small changes also reduced her margin. A sleeve adjustment might take 30 minutes, while replacing a zip could take much longer. When those extra hours were not recorded, two outfits with the same selling price produced very different profits.

Priya began writing down every alteration and the time it required. For complex designs, she now includes one minor alteration in the quoted price and charges separately for major changes requested after fitting.

Five details to track for every order

1. Total selling price and deposit received.
2. Material and outsourced work costs.
3. Hours spent sewing and fitting.
4. Alterations requested after the first fitting.
5. Final payment and actual profit.

Try this for seven days

List every unfinished order and place it into one of three groups: waiting for materials, work in progress or ready for collection. Record the deposit, costs already paid and balance still due. Before using any deposit, make sure the money needed to complete that customer’s order is protected.