Marketing is important to any business, but there’s maybe one thing that’s more important than marketing: profit. So on today’s podcast, we’re doing something a little different and talking about the Profit First approach with expert and fellow podcaster Michele Williams.
Michele Williams is a certified Profit First professional who focuses on helping creative business owners grow the profit of their business. She’s the head honcho of Scarlet Thread consulting, and helps business owners fix their financials and better understand how money flows through their organization. She’s also the host of the Profit is a Choice podcast.
What You’ll Hear On This Episode of Wingnut Social
- [1:10] Intro and why Natalie needs to listen to more podcasts
- [3:22] LuAnn Live info!
- [4:24] The 411 on Michele Williams
- [5:31] What’s coming up for Michele and an intervention for Natalie
- [7:43] How Michele happened upon the Profit First method
- [10:30] How Profit First relates to marketing
- [13:19] Profit First in a nutshell
- [17:21] The Profit First methodology
- [26:27] How to work with banks and bookkeepers
- [32:45] The first resistance to Profit First
- [34:55} What is Natalie’s major damage?
- [38:09] Whut up, Wingnut?
Connect with Michele Williams
- Scarlet Thread Consulting
- Profit Is a Choice Podcast
- Scarlet Thread on Facebook
- Scarlet Thread on Instagram
- Michele’s Facebook group for interior designers
Resources & People Mentioned
- Come to LuAnn Live!
- High Point Market
- Profit First
- 212: The Extra Degree
- Michele’s booklist
- Get your Audible Free Trial!
Profit First in nutshell
On this week’s episode, Michele breaks down the “Profit First” approach to running a business by drawing an analogy to a family’s income. When you have a certain amount of money coming into the home, you know you have to budget a certain amount to pay necessities: mortgage, utilities, groceries, etc. It’s the same with a business, you may have $10,000 coming in, but you know you have to pay $2,000 to a vendor. But you rarely think about how much profit you are saving.
Michele tells Darla and Natalie that Profit First switches up the mindset of business owners, and tells them they need to sock away a bit of profit every month, to either allow the business to grow, or to pay for unforeseen expenses. And so what you’re doing by prioritizing and saving profit, is you’re investing in the sustainability of your business, and getting off the “living paycheck to paycheck” mentality of many business owners.
How to make a Profit First methodology
What’s maybe surprising about the Profit First approach is that it’s a literal change to how you manage your money. That may mean setting up a separate account in the bank, or even at another bank if you might be tempted to dip into an account at your current bank. In many ways, Profit First is about organizing your money in a structured way so it cannot slip into other revenue streams.
Most of the companies that Michele works with saves between 5% and 10% of their profit. But, as she told Darla and Natalie, not every business can do that. So even if you’re just starting out, putting a few dollars away a month will get the ball rolling.
Connect With Darla & Wingnut Social
- On Facebook
- On Twitter: @WingnutSocial
- On Instagram: @WingnutSocial
- Darla’s Interior Design Website