Profit First: Transform Your Business from a Cash-Eating Monster to a Money-Making Machine (Entrepreneurship Simplified) Profit First: Transform Your Business from a Cash-Eating Monster to a Money-Making Machine (Entrepreneurship Simplified) Hardcover Audible Audiobook Kindle Audio CD

THREE STEPS TO PERMANENT PROFITABILITY

CHANNEL BEHAVIOR

Most entrepreneurs run their business via “login and see what you’ve got - bank balance accounting.” If you do that, too... congratulations! Profit First was made for you.

Profit First is a cash management system that works with your bank accounts. The do-it-yourself process pre-allocates money to its intended use before you spend it. When you log into your bank, you will know what money is available for what purpose.

REMOVE TEMPTATION

Just like the 401k has been the greatest personal savings mechanism in US history, Profit First leverages the same “pay yourself first” principle. First, your business will deduct its profit and transfer the money away from your primary bank to prevent the business from “borrowing from it.”

With the temptation to run your business from its profits removed, you will automatically operate your business in a fiscally sound manner.

REWARD QUARTERLY

As profit accumulates, the owner(s) of the business will take a quarterly profit distribution. The profits are not “plowed back” or “reinvested” into the business - or they should be reclassified as expenses. Instead, the profits are used to reward the owner(s).

Some businesses have debt, of course. Using the Profit First system, portions of profit distributions can be used to pay off chunks of debt, but some must remain to reward the owner(s). With Profit First, you win. Every quarter.