Do you take your profit first in your business?
How would you like to take your business to greater levels of profitability while taking a consistent monthly salary from your business?
I follow the guidelines of the Profit First method in my own business. Also, as one of the first steps in setting up financial controls in my client's businesses I highly recommend this method to my clients.
Actually, I give all my new clients a copy of Profit First as one of their on-boarding gifts! ?
If you're just now hearing about Profit First, I heartily recommend reading the book, Profit First: Transform Your Business from a Cash- Eating Monster to a Money-Making Machine, by Mike Michalowicz.
Actually, if you’re the type of person who prefers to listen while you’re driving in the car or taking your daily walk, I love the Audible version of this book.
Mike is so real and such a "hoot" to listen to.
I love how Mike shares his stories of the numerous financial mistakes he made in his own business before he broke through to success.
Don't take me wrong...
I do not like to revel in the downfall of others.
There is an encouragement for business owners in hearing how others navigated the challenges of building a business and finally broke through to the other side.
We all have struggled and most continue to be challenged by the day-to-day financial decisions of building and running a business.
Mike has been where many business owners are. He gets us!
Is cash in your business going out faster than it's coming in, and expenses feel out of control?
Watch Mike’s video below and you can get a feel for Profit First and implementing the Profit First disciplines into your own business will turn your financial world around.
Before my clients and I started working together, they weren’t sure where the money went, and they were half afraid to find out.
Denial is not a sustainable plan.
They lost sleep because they were stressed about money.
Read what Mike says in this excerpt from http://profitfirstbook.com.
I included this selection because it perfectly sums up where many of my clients were before implementing Profit First into their business. And, most likely experiencing yourself right now.
“… Money problems occur when one of two things happens.
Sales slow down. The problem here is obvious when you operate check-to-check and sales slow down: when your one big client goes out of business, or that big deal you were banking on falls through, you won’t have enough to cover expenses.
Sales speed up. This problem here is not obvious, but it is insidious. As your income climbs, expenses quickly follow.
Big deposits feel great, but they are irregular.
Consistent incoming cash flow is hard to sustain. A great quarter can trick you into believing your business is on a permanent upswing, and you start spending like this is the new normal. But drought periods come quickly and unexpectedly, causing a major gap in cash flow.
And cutting back on expenses is nearly impossible because our business (and personal) lifestyle is locked in at our new level.
Exchanging the newly leased car for a rust bucket, laying off employees because we’re overstaffed, saying no to our partners—all of this is very hard to do because of the agreements and promises we made. We don’t want to admit we’ve been wrong in how we’ve been growing our business… ”
The good news: Sales and money are coming in. Hallelujah!
The bad news: You don’t always have a consistent money flow, or you’re not sure where it’s going – or both. Even worse, you don’t get to pay yourself consistently because of that.
The best news: We can fix it!
I’m a proponent of Profit First because it’s a financial concept that makes sense, easy to implement and my clients begin making profit and taking a consistent salary immediately upon making the financial decision to implement Profit First into their business.
One of the most important questions that I ask during a discovery call with potential clients is when was the last time they actually took a salary (owners pay) from your business. The answer is typically an exasperated, it’s been months, or I’ll take money here and there.
It’s discouraging to generate good revenue in your business and then not feel the reward of a consistent owners pay, easily be able to pay taxes and have enough cash on hand to ride out the ebbs and flows of business expenses.
Adopting Profit First Principles
The greatest value of adopting Profit First principles in your business is:
You’ll have less stress around your expenses, bank accounts, and cash flow.
implementing Profit First Guidelines Into Your Business
When we implement the guidelines of Profit First, along with my high-level business management services, we’ll up level and begin to build a strong foundation for your business in many areas:
No stone is left unturned.
We’ll turn your business into a profit-generating powerhouse while giving you the time you want and need to lead your company to new levels.
Best of all, you’ll have the time and money freedom to enjoy the fruits of your labor.
No more spending long hours a week in your office.
No more stress about your business operations or your team.
You’ll enjoy a SUCCESSFUL BUSINESS and a LIFE that you love.
What difference would it make in your business and personal life if you had a system for getting on top of and maintaining the financial structures of your business? A system where you can take your profit every month?
Click here to read a guest article, "Are You Taking Profit First?" from a friend and business colleague, Jillian Verdun, JMV Financial Services. Jillian is an Accountant, Financial Consultant, and Speaker. Jillian trained with Mike and is a Certified Master Profit First Professional.
It is my prayer that this article helped you. I would love to hear your comments below.