Another month already! Time’s just flying by as usual, but does it seem to be going so much more faster these days?
It’s a busy time for me at work (also because I’m juggling work with starting my own business) but I continue to find time to partake in some of the things that bring me pleasure – reading (or should I say listening to books)! I’ve been listening to a book I had heard so much about! Acolades were again given to it recently on my LinkedIn feed, so I thought why not get it now!
About half-way through, I thought “how timely for me as I start up my business (BAnC Services – follow and reach out reach out if you require any of the services we offer).”
It talks about exactly what we say about building wealth! Without reading it though, it would never have occurred to me to apply the same principles to my business – pay yourself first, automate it, build-up your emergency funds, pay down or eradicate debt, only spend what you have.
In the simplest form of relaying the message, the key principle of the book is taking profit first (a bit like pay yourself first)! How would that work (I hear you ask)? Set aside a percentage of revenue into different pots; profit, tax, emergency funds (reserve), and any pot necessary for your business, and then the rest is left for operational expenses; that’s how it would work.
Guess what, if the funds for operational expenses don’t suffice, you figure out how to increase your revenue so you can cover the cost or you figure what is absolutely necessary for your business and which cost can be eliminated! There’s a few more nuances to what Profit First preaches, but in its most simplistic form, it is exactly what you would do in your personal life if you have been heeding the advice of how to grow your wealth.
Isn’t that a fantastic way to run a business? If it works in our personal lives, surely it’s got to work in business right? Well, I am definitely going to incorporate it into my business as it grows, initially in the most simplistic manner I describe above and thereafter, bring in the other nuances.
I recommend this as a useful read for start-ups! Best to start out right.
📝 Originally shared under my first blog, bitalks; part of the journey that shaped Life’s Riches.