There’s a lie going on in the entrepreneurial and small business world that’s leaving people broke, stuck and frustrated and it’s time to call it out!
I have seen that lie occurring with many of my small business clients, my private VIP clients and in the many networks that I am in.
That lie is that you can build your business by growing your revenues alone.
That lie is that with cash in your bank, you’re doing well.
That lie is that by tracking revenues daily, you’re going to be okay.
In my 20+ years of working with small business owners and entrepreneurs, this is the biggest mistake I have seen.
Now, don’t get me wrong, tracking your revenues is crucial. The quickest way for companies to grow is to increase their revenues in some form or other. (In another post, I share with you the 3 main ways to increase revenues in your business.)
However it’s not how much you earn, it’s how much you keep!
Income (Profits) = Revenues – Expenses
So, creating an increasing amount of income should be your main focus.
Why?
Because you get to keep what’s left! And what’s left i.e. your profits, can be reinvested into your business to grow your business.
When you focus on income, you start to create a holistic and a strategic way of growing a sustainable business, a business that can last.
You incorporate all aspects of your business, including looking at your expenses, looking at your cash flow, looking at your team and the leverage you’re creating to multiply the business.
The more revenues you earn, with all things being equal, the more expenses you will incur. So it’s important that you track these expenses to determine your monthly and annual income.
As you’re building a business, a part of your team should include a strategic business coach or adviser who can drill down from the reports that your bookkeeper or your accountant produces to determine the underlying factor of what’s going on in your business.
In that way, you focus on the right strategies to grow your profits and not just focus on growing revenues.
Remember revenues are temporary, profits are forever!™
If you need some advice on drilling down from a high level to create a strategic approach to running your business, book a Discovery Session today.
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