There are three main reasons why Profit First may not work:

1. Lack of income to cover costs
   If you’re not earning enough to cover your costs, let alone pay yourself or set aside money for the future, Profit First won’t work for you. Overspending is a common cause of business failure, and a key reason why Profit First might fail in your case. Fortunately, there are steps you can take in the spirit of Profit First. First, review your costs—identify what you’re spending on and cut back on anything that isn’t making you money or contributing to future income. Second, focus on increasing your income—promote yourself using strategies that have worked in the past and seek new customers. Be innovative! Spending 108% of your 100% income will quickly deplete any savings and lead to trouble.
2. Starting too fast
   Some businesses can jump straight into the Profit First system, following the percentages outlined in Mike Michalowicz’s Profit First. However, most businesses aren’t ready to implement the ‘best practice’ Target Allocation Percentages right away. It’s better to work out what percentages are right for your business and slowly move towards those targets. For most businesses, this process will take 18 months or more.
   (Add a copy of the percentages here.)
3. Not committed to making it work
   Business owners who have always struggled may not appreciate the clarity that comes with having money set aside for specific purposes. Many business owners say they “don’t need much to live on,” and that’s fine—but what about ensuring your business is sustainable for the long term? What about making sure your staff always have a job to return to? Implementing a cashflow structure like Profit First gives you the freedom to stop worrying about daily financial decisions, and instead focus your energy on growing your business, finding new clients, and exploring new ways to deliver your products and services. Or, simply rest easy knowing your business has your back.

Key Takeaways:

• Review your costs to ensure you’re spending less than your income.
• Start slowly and consider using a Profit First professional to help.
• Believe in the system—it’s worked for hundreds of thousands of businesses worldwide.

If you’d like a complimentary chat about how Profit First can work for your business, book with me now:
https://app.acuityscheduling.com/schedule.php?owner=18230665&appointmentType=26579492

By Jodi Porteous, CPA & Profit First Professional Mastery Member