Why do business owners always take the leftovers?
What if I told you: “You should pay yourself first!” and, “It’s okay to profit from your business. Actually, it is preferred to have a profit in your business.”
Look, we put our blood, sweat, and tears into our businesses. We spend countless hours taking care of our customers, going to training/education classes, getting certified, paying the State for Licenses and business fees, etc., why shouldn’t we be paying ourselves first?
For years, I have been telling business owners, not to “zero out” their Profit & Loss Statement (P&L); that they need to show a profit. If you need a loan to get some equipment, having that profit in the business will show the bank or lending institution that you are capable of making the payments. Back in 2015, I found a book called Profit First by Mike Michalowicz and he was right there with me on this.
Here is a formula he created:
Yes, you read that right! Sales – Profit = Expenses. Pay yourself first!
But, paying yourself first should be me more than your paycheck, it should include your share of taxes that you have to pay the IRS at the end of the year, quarterly profit distributions, retirement, and more.
A week after the world shut down due to Covid-19, I signed up with Profit First to become a Profit First Professional. Because I value myself and other entrepreneurs, I went through their training and climbed the levels up to Mastery Profit First. Today, Piña Business Services helps companies come up with their Profit First Plan. We hold monthly coaching calls with our clients and go over their numbers with them to make sure they are staying the course to reach their Personal and Business goals.
Have you sat down with your accountant to go over your plan, your goals, and vision of your company so they can help you reach the level you are meant for? If you have not done so already, call and schedule an appointment with your accountant and maximize them to your benefit. That is why you are paying them, after all.
If you do not have an Accountant that can help you out, please take the time to schedule a Free Consultation I would be happy to help you get started.
Click the link below to take the first steps in starting your new Profit First Plan > https://go.thryv.com/site/pinabiz