How many decisions did you make for your business last year? Decisions to solve a problem, fix a mistake, decide whether or not to take advantage of an opportunity, add a new product or service to your offerings, or try a new marketing strategy. No doubt you made a lot of decisions last year and put out a lot of fires. Phew.
Now, let me ask you this: Did any of those decisions move your business forward in a big way? Did your company see record growth? Were you able to step back from the grind of doing all the things and let your team run things? Did you make a significant impact in your clients’ lives? In your community? In your industry? If you answered yes, I’m stoked for you. If you answered no, welcome to the common experience of business ownership. Or what’s better known as the Survival Trap.
So, what exactly is this trap that so many of us find ourselves in? Well, picture this: you’re running your business day in and day out, but no matter how hard you work, it feels like you’re barely treading water. You’re just scraping by, living paycheck to paycheck, with little to show for it in terms of profit or financial stability. That, my friends, is the Survival Trap in action.
Let me break it down for you. The Survival Trap is a vicious cycle where businesses struggle to make ends meet, constantly playing catch-up with bills and expenses. It’s like running on a hamster wheel, working tirelessly just to stay in the same place. And trust me, I’ve been there myself.
What makes the Survival Trap so insidious is that it’s not just about the numbers on your balance sheet. It takes a toll on your mental and emotional well-being too. The stress, the worry, the constant uncertainty – it can all lead to burnout faster than you can say “profit margins.”
The Survival Trap is deceptive because it fools us into thinking we are at least inching toward our vision, as if our reactionary behavior is actually “smart” or evidence of our good instincts, and will eventually lead us to the promised land: financial freedom. When it comes to our business’s (lack of) cash flow, we often throw our few remaining dollars at the immediate problems and opportunities, hoping that profit will magically materialize.
When it comes to our time, we burn out ourselves and our people by working even longer hours, constantly putting out fires, and chasing arbitrary quarterly targets instead of building sustainable systems. And when it comes to fixing the business, we find ourselves patching up the obvious problems, only to wonder why they keep reoccurring over and over again.
The way out is through implementing the Profit First system. It offers a transformative solution to the Survival Trap by prioritizing profit through the allocation of revenue into separate accounts dedicated to profit, owner’s compensation, taxes, and operating expenses. Then, your profit will be a priority, not an afterthought.
This approach to financial management ensures that you won’t have to constantly chase money down and breaks the cycle of seeking cash to cover expenses. You’ll create a sustainable financial foundation that fuels growth and resilience for the long game.
Wishing you tremendous success!
-Mike
Last I saw there was a discount! Get Profit First for you or a friend at Amazon, Barnes & Noble, or any of your favorite booksellers.
