Today I want to dive into a topic that’s been a bit misunderstood in the world of business finance: Profit First. If you’ve ever wondered whether implementing the Profit First system means putting your employees on the back burner, let’s clear that up right away. Dave Ramsey, the renowned financial expert, once mentioned that it should be “people first, not profit first” in a video discussing Profit First. While his concern is valid at first glance, I want to assure you that Profit First isn’t about neglecting your employees. In fact, it can be beneficial for both business owners and their teams. So, let’s explore how Profit First, despite its name, is all about prioritizing people – your employees, you as a business owner, and even your community.
Profit First: Beyond the Name
The Profit First system isn’t just about funneling profits into the owner’s pockets while leaving employees in the dark. It’s a holistic approach to managing your business finances that can bring real benefit to everyone involved. One of the most significant advantages of implementing Profit First is that it helps business owners start paying themselves consistently. Surprisingly, many owners find themselves earning less than their employees, even though they’re the one steering the ship. This can lead to immense stress and financial uncertainty. But with Profit First, owners establish a clear financial structure that ensures they get paid regularly. This financial stability, in turn, allows business owners to lead with confidence, knowing they can meet their own needs.
Imagine this scenario: You’re the business owner, and due to financial difficulty, you’ve had to resort to desperate sales tactics to make ends meet – it’s a situation nobody wants to be in. But when you’ve implemented Profit First, you won’t find yourself making quick decisions that could harm your business in the long run. You won’t pressure your employees unnecessarily or make impulsive choices out of desperation. Instead, you can operate from a place of financial security, reducing stress and creating a healthier work environment.
Tackling the Tax Season Stress
Tax season can be a nerve-wracking time for many business owners. The anxiety of receiving a large tax bill from the IRS is all too familiar. However, Profit First offers a solution to this annual headache. With Profit First, you set aside funds for taxes before you spend your business earnings. This proactive approach means that when tax season rolls around, you’re well-prepared to pay your dues. No more last-minute scrambling or sleepless nights. The peace of mind that comes with knowing your tax obligations are covered is invaluable.
A Sense of Purpose
Profit First also gives business owners a unique opportunity to inject purpose into their financial practices. It’s not just about accumulating profit for oneself; it’s about utilizing those profits to make a positive impact. Many Profit First practitioners allocate a portion of their profit to various causes – whether it’s donating to charities, contributing to their church, or creating a bonus fund for their hardworking employees. Adaptability of the system allows for a multitude of ways to benefit others, not just the business owner.
In some inspiring cases, business owners are even committed to making their employees part-owners of the company through Profit First. This vision aligns perfectly with the system, and it’s something we actively support in our consultations. When team members feel invested in the company’s success, it will inspire them and give them a sense of belonging.
A Secure and Prosperous Business
Ultimately, the heart of Profit First is to build a strong, prosperous, and profitable business. Profit doesn’t have to be seen as a negative force; instead, it signifies a secure business that can provide stability and employment opportunities. Just picture a scenario where, prior to a sudden lockdown, your business had six months’ worth of operating costs safely stashed away. This level of financial security is achievable through Profit First. With such financial reserves, you wouldn’t have had to make difficult decisions like laying off employees. You might even have been in a position to offer them raises post-lockdown. The possibilities are endless when you prioritize Profit First.
Profit First is much more than its name suggests. It’s a system that not only benefits business owners but also prioritizes their employees and the overall prosperity of the business. By implementing Profit First, you can ensure that you receive a consistent paycheck as a business owner, reducing financial stress and enabling better leadership. It helps you plan for taxes, eliminating the annual tax season panic. Moreover, Profit First allows you to infuse purpose into your financial practices by contributing to charitable causes or empowering your employees. Ultimately, Profit First leads to a secure and prosperous business that can weather unexpected challenges and even thrive in uncertain times.
If you’re interested in delving deeper into Profit First, be sure to check out our Profit First playlist on YouTube. And if you’re ready to take the leap and implement this system, consider our program, Adventure to Profit, where we not only guide you through Profit First but also help you increase your revenue and efficiency while boosting profitability. We look forward to assisting you on your journey to financial success!
How We Can Help
Visit now to access personal mentoring from our expert Matterhorn team. Complete a quick application on the site to get started on your journey towards success. See you there!
About Abby Johnson
Abby Johnson, is Matterhorn Business Development’s Chief Mentor, resident organizational genius and Certified Profit First Professional, helping our clients grow and organize their businesses. With a passion for empowering businesses to thrive and extensive experience in helping clients grow their revenue and manage their finances profitability, she’s committed to making a positive impact on your business.