Profit is an elusive creature in business. It can be difficult to measure, hard to quantify, and easy to lose sight of. But the truth is that profit matters. It’s one of the reasons why you chose to have your own business in the first place.
There are many ways to increase your profits, but this post will focus on how one specific model can help you achieve immediate and permanent profitability: Profit First
Related read: PROFIT FIRST PROGRAM | Our Services
At Sum of All Numbers, we provide bookkeeping and consulting services using the Profit First system. Call us at + (888) 564-5777 or schedule an appointment.
1) Get the free resources.
Profit First is a methodology based on your unique behaviors and sound business principles. Its main goals are to:
- have a positive cash flow for your business to alleviate the stresses of meeting expenses when they come due;
- pay yourself, the owner of the company, for the work you perform in the business; and
- pay yourself, the owner of the company, for the risks you took on to start your own business.
So where’s the profit?
We define profit as paying yourself for the risks you took and continue to take as you operate your business.
Sounds good, doesn’t it?
The good news is that there are numerous tools and tips that you can use to begin your journey, and they are accessible to all. Here is the link to access the best resources for starting your Profit First journey.
2) Read the book.
The methodologies for attaining seamless, solid, and permanent profitability are contained within the book “Profit First” by Mike Michalowicz.
As an entrepreneur, he has felt the pains of not having enough cash to cover payroll or working countless hours for everyone else to get paid with very little left to put into his own pocket. After his personal experiences, Mike established his mission to “eradicate entrepreneurial poverty” and started writing books to fulfill it.
Within the pages of this book, you will be taken on a journey to establish the rhythm of money management for your business. You will be taught foundational principles that turn your efforts into cash in the bank.
The book is easy to read and full of practical advice on implementing Profit First regardless of the size of your business or the specific industry you are in.
3) Master the process.
Mastering the Profit First process is key to your company’s ongoing profitability.
Every time your business makes a sale, the Profit First system has you take a percentage of that money to set aside in a separate bank account labeled “Profit”. Every time!
The remaining cash is meant to be used to pay yourself and the business’s expenses.
It sounds so simple—why isn’t everyone doing this?
Mike shares countless stories in his book on the stumbling blocks that arise preventing businesses from mastering the process.
It’s your turn now. This system has been proven and tested by hundreds of thousands of companies, so there’s no reason why it won’t work for you too.
4) Make serious profit permanently.
Running your own business is not for the faint of heart.
The year 2020 brought restaurant owners and other industries to a screeching halt as the COVID pandemic prevented human interactions. Then 2021 ushered in an era of supply chain shortages causing sales to be lost due to the inability to obtain critical supplies and materials. While 2022 told a story of inflation and a shortage of labor.
The truth is that a crisis of some size will affect your business regularly. But business owners who are able to plan, strategize, and adjust are the ones who continue to operate.
Profit First is part of that plan and strategy. With Profit First, adjustments happen immediately before serious consequences can occur.
In addition, Profit First will help you reach your financial goals—both for your business and for you personally. You will achieve a business that lasts and the life you’ve always wanted together with your family and friends.
Profit first system: permanent profitability
Profit First is an innovative system that can help businesses achieve permanent profitability. However, since the system does not follow a traditional way of doing things, getting started and mastering it doesn’t always happen immediately.
Like learning your fitness or achieving milestones, Profit First is much easier when someone guides you on getting started and staying the course. And once you gain a full understanding of the system and of the unique behaviors that are a part of your business, you’ll realize that Profit First provides the pathway leading you directly to wealth.
Related articles:
- WHY WOULD I NEED PROFIT FIRST PROFESSIONALS FOR MY BUSINESS?
- THE PROFIT FIRST METHOD GUIDE FOR NEW BUSINESS OWNERS
If you are looking for an accounting solution using the Profit First system to help you focus on your business, Sum of All Numbers can help you with that. Call us at + (888) 564-5777 or book an appointment.
