How often do you think about the profits your interior design business makes? Daily, weekly, yearly?
Or are you more focused on growth, revenue, and the next big investment you can make?
In his book Profit First, Mike Michalowicz says “Profit is not an event . . . Profit is not something that waits until tomorrow. Profit must happen now and always.”
And Mike is right. Revenue, growth, and investments are important – we all know that. But the actual profit that you make from your business sometimes gets lost in the shuffle. You’re focused on serving your clients, moving up the ladder, and remaining creative in your work. But what about when you get years down the road and realize all of your work still isn’t profitable?
Think back to that quote from Mike. He says that “profit must happen now and always.”
Most business owners don’t run things that way.
The Profit First method does two things differently –
It focuses on making financial changes now in order to begin making a profit ASAP.
But it also focuses on making financial changes now for success way into the future.
It does this in two ways:
- Establishing healthy habits
The Profit First method forces you to recognize the areas where you’re overspending and helps you adjust how you use your money throughout your business. This isn’t a “one-and-done” practice – it takes time to regularly exercise this new muscle of saving money and allocating your revenue into different streams for your business.
Our response to that would simply be, what’s the harm in making the changes now?
If you’re going to be working with an increased client and revenue load you work with in the future, you might as well learn to handle the responsibility in smaller ways from day one. Some business owners ask “Why would I do all of this now, when I could just implement these changes when my business is growing and doing better than it is right now?
- Setting up sustainable systems
You don’t want to have to use a confusing or outdated financial management system as your interior design business grows. Profit First is set up to be flexible and grow with you no matter what stage your business is in – whether you’re working with one client or dozens.
Systems and dependable processes are great, but maybe you’re wondering:
“What about taking risks?”
With Profit First, there is less wiggle room for taking large risks, especially when you’re first starting out.
But the good news is that you’re still always in control of where your money is going. If you need to have a season of your business pouring more into your savings, then raise those percentages! But if you come to a place where it’s a good time to take risks, start allocating more funds to the area where you want or need to try something new.
Yes, Profit First has boundaries – in place for the sake of your own self-control and long-term success. But at the end of the day, you know yourself and your own behavior. If you need to adjust some rules as time goes on, talk with your Profit First accountant and make a thoughtful game plan to aid you as you dip your toes in the water of making some adjustments.
If you have questions about how Profit First could work for you business in the short and long term, we’re here to talk!