What is
Profit First
Profit First is a cash management technique developed by Mike Michalowicz that treats profit as part of your budget, rather than the lucky leftovers. Using intuitive methods that work with human behavior, you develop money-saving habits that actually stick.
Profit is not what's left over after expenses. Our revolutionary bookkeeping method starts there
and ends by making you more money.
The commonly used formula for determining business profit is Sales – Expenses = Profit. It is simple and logical, but unfortunately, impractical. The formula makes absolutely no allowances for human behavior.
Last we checked, humans run businesses. Not the other way around. And check–to–check survival is no way to run a business. Profit First is the better way and it starts by rearranging that old worn out formula.
Profitability isn't an event;
it's a habit.
– Mike Michalowicz
The math still works out the same. But the Profit First formula removes the temptation of human behavior that sideline so many promising businesses. Plan first and then work the plan, right? Let us show you how.
Improve Your Business
with an accredited profit first professional
and certified bookkeeper
Cash Flow Roadmap
The old saying “cash is king” does not quite go far enough for business purposes. We think “cash flow king” is more like it. Adequate cash flow is quite literally, the lifeblood of every successful business. Maintaining that ebb and flow with a robust cash and liquidity management system plays a key role in the life of a thriving business. In a perfect world, business profitability starts on Day One and keeps producing profits quarter-by-quarter until a business is sold or closes. However, that is often not the case. Sometimes businesses need years to move out of the “red” and into the “black”. Doing so takes planning and commitment and that’s where One21 comes in.
We’ll work together to lay out a plan based on the fundamentals of Profit First to begin generating profits that your business can reliably deliver. Take the first step along the road to profits and schedule your FREE Profit First / Bookkeeping consultation.
Related Blogs
5 Reasons Why a Profit-First Bookkeeper Should Be on Your Team
There are many reasons you should have a Profit–First bookkeeper taking care of your business finances. You want to ensure that your company is profitable and that money is flowing where it needs to be. A Profit–First bookkeeper maintains detailed records and uses the unique Profit–First system to make your business finances work for you.
What Is Profit First Bookkeeping and Can It Help Your Business?
Profit First is a revolutionary accounting system that throws out the old rules of accounting. This method takes a percentage of the sales to pay owners first. Separate accounts are created to set aside certain percentages of what’s left for other costs. Owners must modify their expenses to fit the model. Profit First turns businesses into money-making machines. It’s a system that’s easy to understand and use.
What Does It Mean When an Accountant Says “Profit First”?
‘Profit First’ was developed by Mike Michalowicz to help small business owners maximize their profits and grow successful businesses. This financial rescue system puts profit ahead of expenses. It changes up traditional accounting rules to ensure that your business maintains predictable profits. This system shows you how to allocate certain percentages of the revenue you have coming into best benefit you. Essentially you are prioritizing your pay as owner followed by your taxes, and other operating expenses.
