This week I’m reviewing books that have changed my life … OK bit extreme but it has changed my business. It has 10X my profit and consistently put profit into my pocket.
When I say profit into my pocket I don’t mean getting paid for what I do. This is extra money on top of my salary (which is a market competitive salary). Would you like to at 50%+ to your income? Profit First is the book that can do this! Here are my 3 standout concepts from the book.
Idea 1 – Constraint
Parkinson’s Law is about how a task will grow or shrink to match the time we have available. If we have a month to do something it takes a month, if we have a few days to deliver the same outcome, we get it done … somehow.
We can use this same principle with our money, if we limit the funds available to pay the running costs of our business we will still operate, we will hustle and innovate to make it work.
Idea 2 – Focus on Profit First
The Primary Effect is that we focus on what we see first. Common accounting says
Sales less Expenses and Costs = Profit
Profit is last, it’s the bottom line, it’s what’s left it therefore gets the least amount of attention. What is we change it to be
Sales less Profit = Expenses and Costs.
Idea 3 – We are lazy
Generally, humans are lazy, we take the easy option when given a choice.
Most of us check our bank balance daily or weekly and are lucky to look at our profit and loss and balance statements monthly (if at all).
So, let’s have a system which manages profit based on our bank account, not our profit and loss statement.
What tips and strategies do you use to maximise profit and ensure you get that profit out of your business? (if you are reinvesting profit into your business then it’s not really profit as Mike describes it)
PS Mike has published a lot of other business books that are each awesome.
When I say profit into my pocket I don’t mean getting paid for what I do. This is extra money on top of my salary (which is a market competitive salary). Would you like to at 50%+ to your income? Profit First is the book that can do this! Here are my 3 standout concepts from the book.
Idea 1 – Constraint
Parkinson’s Law is about how a task will grow or shrink to match the time we have available. If we have a month to do something it takes a month, if we have a few days to deliver the same outcome, we get it done … somehow.
We can use this same principle with our money, if we limit the funds available to pay the running costs of our business we will still operate, we will hustle and innovate to make it work.
Idea 2 – Focus on Profit First
The Primary Effect is that we focus on what we see first. Common accounting says
Sales less Expenses and Costs = Profit
Profit is last, it’s the bottom line, it’s what’s left it therefore gets the least amount of attention. What is we change it to be
Sales less Profit = Expenses and Costs.
Idea 3 – We are lazy
Generally, humans are lazy, we take the easy option when given a choice.
Most of us check our bank balance daily or weekly and are lucky to look at our profit and loss and balance statements monthly (if at all).
So, let’s have a system which manages profit based on our bank account, not our profit and loss statement.
What tips and strategies do you use to maximise profit and ensure you get that profit out of your business? (if you are reinvesting profit into your business then it’s not really profit as Mike describes it)
PS Mike has published a lot of other business books that are each awesome.
