Day 895: Profit. First. Margin.

Last week we covered a lot of ground including how dumb these sayings usually are, ‘if you’re not growing, you’re dying’ and ‘the higher the risk, the higher the reward’, as well as how Dangerous Dave’s stepbrother got his name.

Speaking of my unsubscribe button…

Taylor Swift was at the Chiefs game with Travis Kelce’s Mom. Here’s their conversation:

Kelce’s Mom: Hey Darling, where did you go?

Taylor Swift: Took a poo.

Kelce’s Mom: Do you wipe?

Taylor Swift: No, I just shake it off.

In other news…

Nobody quits a company, they quit a boss.

Anyhoo…

Your One PROFIT ACCELERATION THING Today Is:

‘Profit First’

Great book… here’s one of the notes I took (boring but IMPORTANT):

You need to do your P&L budget from your gross profit and not from your revenue.

Therefore, your expenses should be expressed as a percentage of your GROSS PROFIT… not of your revenue.

Read that sentence again please.

Let me give you an easy-to-follow example:

Your coaching client sells widgets and their financials look like this:

Revenue: $100,000

Cost of Goods Sold (COGS): $40,000

Gross Profit: $60,000

You need to help your client base their budget on gross profit, not their total revenue.

So, assume you allocate gross profit as follows:

Operating Expenses: 30% of Gross Profit

Owner’s Pay: 50% of Gross Profit

Taxes: 15% of Gross Profit

Profit: 5% of Gross Profit

Here’s how you’d calculate and allocate your clients expenses using this method:

Operating Expenses = 30% of Gross Profit = 0.30 * $60,000 = $18,000

Owner’s Pay = 50% of Gross Profit = 0.50 * $60,000 = $30,000

Taxes = 15% of Gross Profit = 0.15 * $60,000 = $9,000

Profit = 5% of Gross Profit = 0.05 * $60,000 = $3,000

Now, your client has a clear budget for each category based on their gross profit:

Operating Expenses: $18,000

Owner’s Pay: $30,000

Taxes: $9,000

Profit: $3,000

This approach prioritizes setting aside money for PROFIT (and taxes) from the beginning.

Profit is an expense in the Profit First methodology.

This also manages their operating expenses within the constraint of their gross profit, which will help control costs and improve their bottom line.

So you can keep getting paid and accept their referral.

You heard it here first.

Now, pick up the phone and go help someone.

Obsessed with your business coaching success,

Karl Bryan

Founder

focused.com

PS. Families gotta start getting back together for Sunday Dinner and Family Reunions… not just Funerals.

PPS. If this helps and you want it to really sink in… GO TEACH IT to someone cause that’s the best way for you to learn it. A friend, your spouse, a prospect, a client etc…

*Don’t plagiarize my work like a lame arse.

PPPS. Marriages break up from lack of money… over lack of love X 100. Business failures lead to destruction, addiction, depression, anxiety, suicides, and unfortunately, far more.

As good business coaches we save marriages, save families, save kids from self-destruction… we save lives!

A true life of purpose.

PPPPS. If you’re looking for a proven system to follow for your coaching…. I created Profit Acceleration Software™ as well as our Digital Acceleration Software™ and high-end step-by-step training to support it…

It’ll teach you ‘How to find any small business owner $100,000 in 45 minutes without them spending an extra dollar on marketing or advertising.’

Imagine finding your annual $12,000 to $50,000 coaching fees BEFORE you started coaching your new clients?!  And a proven coaching system created for you to follow with your new coaching client.

PPPPPS. Forward this to someone that needs to subscribe to my daily emails and get a limited-time, complimentary subscription to my business coaching magazine go here:

https://thesixfigurecoach.com/subscribe/

PPPPPPS. They tell me my Podcast is Ric Flair style, Money Makin, Client Getten, Joint Venture Landing, Event Fillin, High-End Coaching Client Findin Gold For Business Coaches.

https://thesixfigurecoach.com/podcast/