Can money really buy you happiness? Can it make the gloomy days sunshiney? Most people have asked themselves this, especially when they don’t have much money to go around. I certainly had this thought in the past when my business wasn’t doing as amazingly as it is now.
I am a Profit First Professional, meaning I work with businesses to help them grow profitably.
More money circulating in a business means higher quality of life for those who work within it, and more potential for the business to grow!
Money is a tool and a freedom, and Profit First can help you make more.
How Does Profit First Work?
Before we dive into the nitty gritty, here’s a quick anecdote to show you what Profit First can do. I worked with a business owner who described the Profit First mindset shift as going from being the business owner working in the business → being the business owner working on her business as an investor. Now she sees that just because she’s an owner doesn’t mean she has to sacrifice time and energy to increase profits.
Now, how do we make this shift happen for you? With Profit First, we determine the purpose of each and every dollar that comes into your business. Does it go towards supplies, paycheques (including your own), facility costs, software costs, delivery fees, expansion investments, etc.?
We create bank accounts that reflect your business’s list of major expenses. Then, every time you make a sale it’s divided into these accounts as is appropriate. If payroll is coming up, incoming cash is put into that account. Or, if everything is running smoothly and you land a bonus sale (yay!), invest that cash back into your equipment or facility. Don’t worry, I’ll help you smooth this process and define these goals!
Every cent accounted for means you’re running a tight ship. With this strong handle on your cash flow, you can start planning for workforce growth, product expansion, a new facility, or whatever your business dreams are.
A Profit First Mentality
Profit First—does that mean profit over people? Nope, not even a little. The reason for that is twofold:
- Only profitable businesses can prioritize people. If your business is losing money you won’t be able to offer your employees (or yourself!) a living wage, health benefits, paid time off, and other features that contribute to a quality work experience.
- A profitable business is good for the people working within it and the people it serves! Employees and owners who are paid well are happier, more motivated, more productive, and more likely to stick with the company.
*Plus: say your favourite doggy daycare goes under. Where will your precious pet go when you’re on a trip? We need small businesses to thrive!
The words Profit First can also make people go straight to corporate greed or runaway profits. Or, in other words, “Are you just helping businesses get rich while the rest of us suffer through inflation and rising costs?” Nope again!
Profit First has mechanisms built in to ensure this doesn’t happen. The profit allocation target percentage at the highest level of Real Revenue maxes out at 20%. And, most businesses that become successful (we’re talking millions) using the Profit First Methodology put it back into their employees’ benefits, their communities, workplace upgrades, and employee wellness programs.
Profit First is not in the business of encouraging corporate greed. We are in the business of helping businesses grow so their success can have a ripple effect.
Can Money Buy You Happiness?
And now, the million dollar question! Here’s my take: money can’t buy you happiness, but it can buy you choices:
All people—business owners or not—make decisions regarding their wellbeing every day. The more funds you have behind you, the easier it is to make choices that boost your quality of life.
For a small business, more profit can look as simple as hiring an advertising firm to get the word out, replacing old equipment, or donating to your community’s food bank to give back.
Profit First isn’t greedy—it’s smart.
If you’re interested in working with me to implement Profit First into your business, book a call with me! I’m excited to see what options we can open up for you!
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