Many business owners work hard in their businesses and never seem to make enough money. They have lots of customers and sales but none of that cash flow seems to ever result in a profit. The remedy for this situation is an approach to business called Profit First. With Profit First your business will always see a profit from day one. How is that possible and how does that work?
It starts with how you do your bookkeeping. The formula that most bookkeepers use takes incoming revenue, subtracts expenses, and gives you profit (or loss). The Profit First system takes revenue, subtracts profit, and gives you expenses. The point of this approach is that you budget and control cash flow in such a way as to control expenses and always guarantee a profit every two weeks, every month, from the time that you start the Profit First approach.
The benefit or value of this approach is that you learn how to control the sort of hidden expenses that steal profits from your business. You master budgeting and cash flow management. And, you see profits, owner’s pay, and money for taxes set aside twice every month. You will make more money, have better control of your business, and be able to focus on exploiting business opportunities instead of always playing catch up with your finances.
Profit First is one of the product offerings at Exigo Business Solutions. We will help you set up this system and provide both a bi-weekly allocation review and monthly allocation report. Our charge for this service is $1,395 a month. The point at which you will want to start using Profit First in your business will depend on your incoming revenue and the degree to which you are turning that revenue into profits.
In general, you will pay $16,740 a year for outsourced services and institution of the Profit First system. For a business with yearly revenue of $279,000 this comes to six percent of revenue. For $334,800 it comes to five percent. With annual revenue of $418,000 it comes to four percent. If your annual revenue is $558,000 you will be paying three percent and a company with annual revenue of $837,000 will be paying two percent of revenue for CFO services.
For more information about how Profit First can help your business, contact us at Exigo Business Solutions.