How to be More Profitable as an Entrepreneur

One crucial outcome for every entrepreneur is to make a profit.  Every time I coach an entrepreneur running a small business, profit is one of the first topics we review and discuss. When discussed, they always ask how to be more profitable.  A business that does not make a consistent profit fails.  I remember just over a decade ago, I was $172,ooo in personal debt when I founded M & E Painting with the last $100 I had to spend.  Over 11 years, our company has become (and still is) one of the fastest growing, best places to work, and most profitable within our industry.  My personal financial snapshot has changed dramatically; one of the key reasons is my desire and intense focus to be profitable.

I’ve spoken with, counseled, and mentored entrepreneurs from a variety of businesses. Those who truly succeed in business and in life have a persistent theme that revolves around profit. Some of the themes, habits, and observations surrounding small business and entrepreneurial profit success stories are included below. My aim is that you may put them to good use in your business and in your personal life.

  • The same way you handle one dollar, you will manage a million dollars. Entrepreneurs that regularly win with money comprehend the concept of a dollar and handle it on a one-dollar basis. A hundred thousand, million, or billion dollars are all the same as one dollar; they only have more zeros. Entrepreneurs that succeed with money ensure that they spend less than they earn, while also knowing what their keep vs. spend percentages are at the $1 level. When I discovered this and acquired clarity about where my pennies were going, I was able to be clear about and manage where my hundreds, thousands, and hundreds of thousands of dollars were going. How do you spend your money? Where are your dollars going?
  • Entrepreneurs pay themselves first.  I remember hearing about the pay yourself first formula years ago. However, every year I always ran the same broken record and formula: Revenue minus Costs and Expenses equals Profit.  I was taking the leftovers.  When I read the book Profit First by Mike Michalowicz, it changed the way I viewed profit. Mike flips the script of the old broken, generally accepted accounting principal of paying yourself last and eating the scraps that fall from the entrepreneurial table. He encouraged me to pay myself, profit first and let my expense category eat the leftovers.  Now I am full! Do you pay yourself first?  How full are you?
  • Profitable entrepreneurs have had a big experience with money that has shown them how unimportant it truly is. Profitable entrepreneurs have a tale about being so strongly moved by money that it changed their approach to it, resulting in a lot more of it. When their balance sheet changed in the blink of an eye owing to the economy or a terrible financial move, they discovered where the actual capital was; they began to count and measure their self-worth in ways other than their net worth. They realized that their human capital, relational capital, and legacy were more precious than all the money in the world. How important is money to you in terms of leaving a legacy?

I have also experienced this revelation.  I remember hitting the financial goal I had of becoming a millionaire before age 30.  When this happened, I realized how unimportant the millions actually were.  That freedom and peace has allowed me to focus on the things that truly matter in my life and business, which is inspiring and igniting other entrepreneurs to own and run their organizations with excellence.  When I lean into my purpose, the money just happens. To get caffeinated with me on a weekly basis, be sure to click the coffee cup and subscribe to my newsletter and blog.  When you do, I will share more of my story with you as well as give you some really cool free tools you and other entrepreneurs can use to win in business.

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