Let me tell you how Profit First transformed my business for the better.
When I became a financial coach, I wasn’t in it for the money (it’s still not about the money but at the time I honestly didn’t expect to have a “real” business). I just wanted to help people budget well and get out of debt.
So like most business owners who are passionate about what they do, I decided to wing it with the business finances. Sure I had a general business budget and cash-flowed my expenses (gotta practice what I preach, after all!) but I was clueless about bookkeeping, and I didn’t know how to look at financial statements to assess the financial health of the biz.
Enter Profit First. Several coaches were raving about it, so I knew it was a must-read book. It challenged everything I had believed about my business.
Stuff like “you gotta spend money to make money.”
“Reinvest your profits is the way to become more profitable.”
“You have to earn x amount until you can pay yourself. After all, income minus expenses equals profit.”
Lies, lies, and more lies!
I immediately reduced my operating expenses by 30%. I focused on how I could most powerfully serve my clients and was cured of shiny object syndrome, which had left me feeling frazzled and defeated. I had so many non-income producing projects on my plate and not enough time or energy to be fully invested in making them valuable, and thereby, profitable.
I got to add an income line to our personal budget and write myself a paycheck every single month. That was a great feeling!
I became comfortable with raising my rates. Once you know A- the value your services provide and B- what a healthy percentage allocation of revenue looks like, you get clear on what you’re actually earning per hour. And let me tell you, $10 an hour wasn’t cutting it anymore!
Finally, I gained self-respect. I didn’t believe I had what it took to build and run a real business. The truth was, all I needed was the right information, some good coaching of my own, and time to apply it. That’s why I’m so passionate now about helping my fellow courageous business owners take charge of their business finances so they can thrive and gain this confidence, too!