How To Increase Your Profitability – Today

When will your business become profitable? Next month? Next year? Mike Michalowicz, author of Profit First: A Simple System to Transform Any Business from a Cash-Eating Monster to a Money-Making Machine, says it should be today. “I always thought that I could run my business on the idea that I should sell as much as I could and spend as little as I could and that profit would ‘just happen,’” he says. “It never did. I realized that I run my business by looking at my deposits (sales) and then paying my bills from what I deposit (expenses)… and always could justify spending/investing every penny I had. Profit was always put off to a future date, and that date never happened.”

He believes the traditional GAAP (Generally Accepted Accounting Principles) formula of Sales – Expenses = Profit actually fails most entrepreneurs, because of human nature… [Read more at Forbes.com]