Profit First
1 min read

Profit First

Lessons from Profit First.

When it comes to your business, always focus on getting your profit first. The first step of profit first is to determine how healthy your business is.

After you examine your business thoroughly, you are free to focus on the big obstacles, not the little fires in your business.

Measure your past revue, profit, compensation, taxes and operating expenses. Figure out the percentages of and exactly how many dollars went to each bucket.

At the start of your business before you hit over $250k/year in revenue, you should aim for 5% profit, 50% owner's compensation, 15% taxes, and 30% operating expenses. You should not be struggling to live comfortably as you grow your business. Once you hit over $1 million/year in revenue, you should aim for 10% profit, 10% owner's compensation, 15% taxes and 65% operating expenses. Figure out how far your are from your ideal numbers, and act accordingly.