Business owners have a passion for their product or services. Very few “dig” the finance part of their operations. But all of them realize that running a business means at some point they are going to have to peek under the hood of their operations and learn about the mechanics of their finances. But ugh, math!
Well, here is the 411 on finance —
Money does not always equal math. If it did we would all do the right things with it like put aside our taxes or save for a downturn. The reason why we don’t do these things is because money is emotional. We look at our bank balance to make decisions in our business over pulling out our P&L or balance sheet.
But what if there was a way to marry the two?
Enter Profit First – a financial management system for our business based on our human behaviours when it comes to money, created by Mike Michalowicz.
The four principles of Profit First are simple:
- Give your money a job – dedicated accounts for the main expenses of your business
- Reframe owners compensation – pay yourself first and get a return on your investment
- Remove temptation – put aside for taxes and profit
- Establish a rhythm – willpower is not enough, you also need a solid system for financial success.
Since establishing Profit First in my business I have consistently been able to pay myself what I am worth, take a profit distribution every quarter, not stress about tax time and have a guide to when my business can “safely” grow.
If you would like to learn more about the Profit First system I invite you to join me on May 11th at 12pm Atlantic for a 1 hour webinar I’m hosting on the Four Principles of Profit First: Register here.
You can also have a listen to my talk with Mike Michalowicz on Profit First, and how it changed the way I do business. Listen here.
I hope to see you on the 11th.
Yours in good financial health,