I remember when I started my first software company. I was 23 years young and had no idea what I was doing. I was just stubborn and determined and certain that I could do it better.
As I started making sales and I started growing my business, I was like, “oh if I can just get to a million, it’s going to solve all my cash flow and money problems”. What really happened is as my sales were growing, I had less money in the bank. As I looked back I was like, wait a second. There were times when I was making $250,000 for the year, but I was more profitable than I was at half a million. I just didn’t understand it. I was constantly beating myself up and asking myself, what’s going on? I’m making all these sales, but I never have any money left at the end of the day.
The reason this was happening in my business, was because I wasn’t actually profitable. I was never looking at the profitability of my company. I was only focused on the top line sales and selling more, more, more.
I never focused on the bottom line and what was left at the end of the day.
Once I started really diving into the profitability, and also being willing to look at it, was when things got better. I learned if you don’t really own your profitability it’s going to continue to be a problem, and it’s a problem that is not going to fix itself.
Look at your internal systems, your automation. Look at your cash and how well that’s being managed, because most of us are never taught really how to manage our finances, how to make smart financial decisions. The good news however is once you learn how to do those things, you only have to learn it once.
Do you need help? Schedule a call with a Profit Advisor. Our complimentary one-hour session is the first step towards having a financially solid business. Schedule a call today.