As I conducted interviews for Profit First, I found a scary trend. Of the 300+ entrepreneurs I spoke with for this book, most are quick to share – scratch that, brag – about the size of their business.
Discussions among entrepreneurs seem to constantly revolve around “size” questions:
How big is your business?
How many employees do you have?
What do your sales look like?
These are bad questions. Bad questions bring bad focus, which in turn brings bad results.
Most of these “successful” entrepreneurs, are on the verge of bankruptcy. Their businesses are big, or are selling a lot, yet they’re spending more than they make. They own companies that are doing (or aspiring to do) millions, yet are going bankrupt in the process.
With the focus on size and on sales and on revenue, these entrepreneurs think the only way to improve things is to sell more. Yet when they do, they spend more. They are in the “spend to sell, sell to spend trap.” The only thing besides growing sales and expenses is stress. Surely not profit.
My goal in Profit First is to shift our entire entrepreneurial culture from one of top line success to one of bottom line success. And I found a simple way to get started. Just ask a better question:
How healthy is your business?
Start asking yourself and other entrepreneurs that one.
The stunned looks is simply a realization that success only occurs when you put profit first. Ask yourself the question enough times and it will become your new focus, and your new reality. Never forget this. . . profit first. Always.