Episode 366
What Is Profit Really? (And Why You Might Not Be Making Any) [Ep. 366]
If you’re hitting revenue goals but still wondering why there’s no money left at the end of the month, this episode is going to give you a reality check. In this episode of The Real Truth About Business podcast, I’m breaking down what profit actually means in a service-based business and why so many entrepreneurs are stuck in a revenue plateau despite “making money.” This is for service-based entrepreneurs who are working hard, bringing in consistent revenue, but still struggling with cash flow and sustainable business growth. After 9 years of experience, I can tell you this is one of the biggest gaps in business strategy. Inside this episode, I walk you through how to calculate real profit, how your time impacts your pricing strategy, and how to fix the leaks in your pipeline and sales process so you can actually keep more of what you make.
What You'll Learn:
- Why revenue does not equal profit in a service-based business
- How to calculate real profit including your time and expenses
- The biggest mistakes hurting your pricing strategy and cash flow
- How your pipeline and sales process impact profitability
- Why underestimating your time is killing your revenue growth
- How to structure your offers for sustainable business growth
Episode Highlights:
[00:00] Introduction: The question most business owners can’t answer
[03:00] Why revenue is a vanity metric and profit is what matters
[06:00] Real example: $5K revenue vs. actual profit
[10:00] Breaking down profit for solopreneurs
[15:00] Why your time must be included in your calculations
[20:00] How expenses and growth impact your profit margin
[25:00] Offer-level profit breakdown and pricing mistakes
[30:00] Why profit is required for scaling your business
[35:00] How to audit your business for profitability
Key Takeaways:
Revenue Means Nothing Without Profit
Here’s what I see constantly. Business owners chasing bigger revenue months and thinking that automatically equals success.
After 9 years of working with service-based entrepreneurs, I can tell you it doesn’t.
You can have a $10K month and still have zero profit left over. Between paying yourself, covering expenses, and handling taxes, that money is already allocated.
Revenue is a vanity number. Profit is what actually determines your business growth.
Your Time Is the Missing Piece in Profit
This is where most people completely miscalculate.
They look at revenue minus expenses and assume what’s left is profit. But they don’t factor in their time.
If you’re working 120 hours a month and only taking home a portion of that revenue, your hourly rate may be far lower than you think.
Inside the Focused Visionary Framework, this directly impacts your Pricing pillar. If your pricing strategy doesn’t account for your time, your business will never be truly profitable.
Your Offers Might Not Be Profitable
One of the easiest ways to diagnose this is to look at a single offer.
Break it down:
- How many hours are you spending?
- What are the hidden tasks before and after delivery?
- What expenses are tied to it?
When you actually calculate it, most offers are underpriced.
This is especially true for longer-term services and coaching containers where time expands beyond what you originally planned.
Growth Can Actually Decrease Profit
This is the part that surprises people.
As your business grows:
- You take on more clients
- You spend more time delivering
- Your expenses increase
If your pricing strategy doesn’t evolve with that growth, your profit margin shrinks.
This is why you can feel busier than ever but not see an increase in revenue growth.
Profit Is What Allows You to Scale
Without profit, you cannot:
- Hire support
- Invest in your business
- Take time off
- Pivot your offers
You stay stuck in a cycle of working to sustain, not to grow.
Profit is what creates flexibility. It’s what allows your business to evolve beyond just maintaining itself.
You Need to Start With Awareness
You don’t need to overhaul everything overnight.
Start simple:
- Look at your last 60 days
- Track your hours (client, admin, marketing)
- Compare it to your revenue and expenses
This gives you a real picture of your business.
From there, you can adjust your pricing strategy, refine your offers, and build a business that actually supports your life.
Resources Mentioned
- Subscribe to Back Pocket Insights for FREE
- Book a CEO Strategy Call
- Learn more about The Missing Piece Intensive
- Learn more about The Focused Visionary Accelerator
- Download the FREE Lead and Conversion Tracker
- Subscribe to the Sunday Morning Brew Newsletter
About the Host:
Michelle DeNio is a business strategist based in Sarasota, Florida, specializing in helping service-based entrepreneurs break through revenue plateaus using her Focused Visionary Framework. With over 300 podcast episodes and 9 years running her consulting business, she helps coaches, consultants, and service providers scale sustainably through strategic planning, pricing optimization, and sales process development.
Connect with Michelle
Transcript
Here's a question that I ask almost every single client when we first start working together.
Speaker A:What is your profit margin?
Speaker A:And what usually comes next is silence.
Speaker A:Or they tell me their revenue or they say something like, I don't know.
Speaker A:I mean, I think I'm profitable, right?
Speaker A:If you can't answer this question confidently right now, like, trust me when I tell you, you are not alone.
Speaker A:But here's what I want to really talk about today in this episode is that you could be making six figures in revenue and still have cash flow issues.
Speaker A:Still feel like, why is it not enough?
Speaker A:Right?
Speaker A:And that's what we're breaking down today is what profit actually means in real terms for solopreneurs.
Speaker A:Specifically, how to calculate it when time is part of the equation and once you do with it, what to do with it once you have it.
Speaker A:So strap it in.
Speaker A:Because this one is going to be a lot, I think, for a lot of you.
Speaker A:But we're going to make it fun.
Speaker A:We're going to make it fun.
Speaker A:So if you're ready, let's do it.
Speaker A:Okay, I.
Speaker A:This is my topic, this is my jam.
Speaker A:I could nerd out on this all day long.
Speaker A:This is my accounting background coming through.
Speaker A:This is why I started telling everybody that I am a profit strategist.
Speaker A:Because this is the through line for every thing I do in business when I'm helping work with people is really looking at how are you creating a profitable business?
Speaker A:I do not give a shit how much revenue you are making because revenue does not equal success.
Speaker A:And a lot of people think it does because especially in the online space, that's what we're taught.
Speaker A:That's what we taught.
Speaker A:That's what everybody talks about, right?
Speaker A:Their hundred K year, their ten k day, their blah, blah, blah, whatever it is, it doesn't really matter because if you don't know what the profit is on that, like, you can't live on revenue alone, right?
Speaker A:Revenue does not equal success.
Speaker A:I know so many companies that are bringing in revenue, but they're not making any profit.
Speaker A:My husband, the company that he works for, is a perfect example of this.
Speaker A:They bring in a good amount of revenue, but at the end of the day, they spend almost all of it on their employees, on their payroll, on their expenses, on their cost of goods sold.
Speaker A:And so at the end of it, there's not a whole lot left to show for it, right?
Speaker A:Because they're literally spending every single dime that comes in.
Speaker A:And then they wonder why when something breaks or they need a new vehicle or something for one of their crew members or they need to buy new equipment, they don't have the cash flow for it because they're not operating a profitable business or operating a revenue only business.
Speaker A:And there are overspending, which does not leave room for anything to happen.
Speaker A:Right?
Speaker A:And this is where you start getting into debt.
Speaker A:This is where you start having cash flow issues.
Speaker A:All the things, okay?
Speaker A:So here's what I want you to really understand.
Speaker A:Revenue is a vanity number.
Speaker A:Profit is your sanity.
Speaker A:Right?
Speaker A:And cash is the reality, okay?
Speaker A:That's what you have to really think about is that if somebody is making a hundred thousand dollars a year, like I said, but they don't have anything to show for it at the end of it, and they can't invest in anything, or they've literally invested everything into it, then they're not making any profit.
Speaker A:And I'll give you another example of this.
Speaker A:So I had last a week or so ago, I had almost $5,000 come into my business.
Speaker A:$5,000 In revenue right now.
Speaker A:I could go on and on and promote that.
Speaker A:I made 5, 000 in a week, right?
Speaker A:I had 5, 000 week.
Speaker A:Really?
Speaker A:Super impressive.
Speaker A:I'm honoring that.
Speaker A:I'm celebrating it.
Speaker A:I am not, not celebrating that.
Speaker A:That was a huge week.
Speaker A:However, I would say I. I'd have to pull the numbers.
Speaker A:Exactly.
Speaker A: But only about: Speaker A:And maybe not even that much because a good chunk of that revenue coming in is ticket sales to the event I'm hosting in the Boston area in September.
Speaker A:And those ticket sales have an expense against it.
Speaker A:I have to pay for the room, I'm paying for meals, I'm paying for my travel up there.
Speaker A:So almost none of that is profit.
Speaker A:It's literally just revenue right now.
Speaker A:And almost all of it is already spoken for because there's expenses associated with it.
Speaker A:Right?
Speaker A:That's what I want you to really understand.
Speaker A:So when you're seeing people say that they had these big months or weeks or whatever it is, they're sharing revenue numbers, you very rarely see somebody say, I made $5,000 in profit this week.
Speaker A:Okay?
Speaker A:And that's what I want you to really think about is like they could be touting all that.
Speaker A:Like, I could literally use that in my marketing that I made $5,000 last week.
Speaker A:Right?
Speaker A:But again, from an integrity standpoint, if I did that, I would absolutely say, but here's what, here's what the take home was of that.
Speaker A:Right?
Speaker A:Because I didn't take home $5,000.
Speaker A:I did not pay myself $5,000.
Speaker A:Just because I made $5,000 does not mean I paid myself $5,000.
Speaker A:Right?
Speaker A:So let's, let's back it up a little bit.
Speaker A:What is profit in general?
Speaker A:Right?
Speaker A:So the textbook version is revenue minus expenses equals profit.
Speaker A:Easy peasy, very easy to, you know, it's right, like you have the money coming in minus the money going out equals profit.
Speaker A:But that's not the whole story.
Speaker A:Okay, so now let's look at it through the lens of solopreneur.
Speaker A:Solopreneur is basically anything that is left after you pay for your, pay yourself any of your expenses, contractors, etc.
Speaker A:That's what's left of profit.
Speaker A:So let's say you have a $10,000 month, you pay yourself $6,000 of that and you pay your team and, or your expenses.
Speaker A:So we're talking software CRM, you know, any of your tools that you're paying for your, your general operating expenses, another 2,000, right?
Speaker A:So we've, we made 10,000.
Speaker A:We paid ourselves 6,000.
Speaker A:We've got another 2,000 in expenses.
Speaker A:That leaves us with $2,000.
Speaker A:Guess where that's going?
Speaker A:To the government.
Speaker A:Because you still got to pay your taxes.
Speaker A:So at the end of the day, your $10,000 month is $0 in profit.
Speaker A:Now you might think because you paid yourself $6,000 that you actually made profit.
Speaker A:Well, yes, but if you had an employee, right, like if you were an employee, so that's an expense.
Speaker A:Employees are expense.
Speaker A:So you need to look at the pay that you're giving yourself as a direct expense against your revenue.
Speaker A:And the other thing is, is that most solopreneurs don't include their time, right?
Speaker A:And they don't calculate their time.
Speaker A:They don't take into consideration the amount of hours they are spending on something.
Speaker A:So you could do the math a different way and be like, okay, I made $10,000 this month.
Speaker A:But if you had $2,000 in expenses like we talked about and you worked, let's say 30 hours a week every for four weeks, it's about 120 hours.
Speaker A:You're down to $66 an hour before tax.
Speaker A:Right before tax.
Speaker A:So now you got to pay yourself taxes, you know, any taxes.
Speaker A:Again, so now you're down to like less than $50 an hour.
Speaker A:Are you still hitting your six figure year?
Speaker A:Probably you're still going to hit that.
Speaker A:But again, what did you actually pay yourself?
Speaker A:What did you actually pay yourself?
Speaker A:Right?
Speaker A:So you can look at it that way because you've got to take into consideration the number of hours you spend and I all the time with my clients.
Speaker A:This is why, like inside of the Focus Visionary accelerator, one of the things that I am so hell bent on is making sure people have their pricing set up for profit.
Speaker A:And I have a tool, I have a free tool that I can send you.
Speaker A:So if you want it, send me a DM on Instagram and just say, michelle, send me your profit calculator.
Speaker A:It's a free one.
Speaker A:Now inside of FBA, we take it 10 steps deeper than what I have on the free tool to really help you calculate out all of your expenses, how, how much you want to pay yourself, how much you want to have left in profit so that you can price your offers accordingly, so that you know that your offers are set up for the amount of hours you're spending on them, the amount of hours you're spending on admin and all that.
Speaker A:It calculates all of those things because all of those play a role in your profit, right?
Speaker A:And you want to have profit because profit is what allows you to reinvest, right?
Speaker A:Profit is what allows you to.
Speaker A:Now I do want to preface this to say, although I have a financial and accounting background, I am not a CPA and I am not a tax strategist.
Speaker A:So I also know that like if on paper you're showing a high profit, you're going to pay more tax on that.
Speaker A:So there are a lot of different things that you can do to mitigate your profit.
Speaker A:But you have to have profit in the first place, right?
Speaker A:Think about like when you worked at a company, I don't know if you ever, if any of you ever worked at companies where they did like a profit share, right?
Speaker A:This is where at the end of the year, if there was profit, they would share it out to all the employees because that then is less that they're paying in tax.
Speaker A:So they can give it out to their employees.
Speaker A:It becomes a write off.
Speaker A:They're not paying tax on it.
Speaker A:So there are ways that you can mitigate the tax implication of this.
Speaker A:But again, you need to talk to a tax strategist about this.
Speaker A:So profit allows you to do some of those things.
Speaker A:So like you could even bonus yourself at the end of the year, you could take some of your profit.
Speaker A:It allows you to have a reserve set up, right?
Speaker A:So like if you want to take, take a vacation, if you want to take a couple months off or you want to take the summer off, you've got your profit that you can fall back on and that you've got this reserve built up and you can then utilize it, especially in slower months.
Speaker A:The other way that profit is very helpful is if you do want to pivot, right?
Speaker A:Because there's all.
Speaker A:There's always a time in our business where we want to make a pivot, but we still need revenue coming in, right?
Speaker A:And so if your revenue and you don't have any profit and your cash flow is super tight, it's very hard to make that pivot because you often during the pivot, are going to see a dip in revenue, which means you're going to see a dip in your cash cash flow, which means you're not going to pay yourself as much.
Speaker A:So having that revenue allows you to do all of those things, but then also profit allows you to reinvest back into your business, right?
Speaker A:This is part of the problem.
Speaker A:This is why so many people say they don't have the money to invest into, to delegate, to hire a strategist, to get into a mastermind program, right?
Speaker A:The reason for that a lot of times is because you aren't building in enough profit into your pricing, into your offers, into all of your.
Speaker A:Into your entire business model.
Speaker A:So there isn't enough money left over.
Speaker A:There is no cash flow left over for that reinvestment.
Speaker A:But we all know that, like, the reinvestment into the business is what helps it to grow.
Speaker A:So this is why it is so crucial.
Speaker A:This is why I always lead with this.
Speaker A:Because what I hate seeing is business owners that are working so freaking hard and they're hitting these revenue numbers and then still sitting here wondering, like, why, why don't I have the extra cash to invest?
Speaker A:Why don't I have the extra cash to pay myself, right?
Speaker A:Because it's.
Speaker A:It's really not profitable.
Speaker A:It's literally just sustaining your.
Speaker A:The enough to, like, build, keep the business going, but it's not doing anything in addition.
Speaker A:And, like, what's the point in that, right?
Speaker A:And so one of the other things that I see that really drastically, really could kill profit that most people don't take into consideration is your hours, the number of time, like hours that you spend on something.
Speaker A:We drastically underestimate this.
Speaker A:Um, the other day inside of fba, we did our Reflect and Refine meeting.
Speaker A:So every single month inside of the Focus Visionary, we do a Reflect and Refine, which is basically a meeting that you reflect on what's.
Speaker A:What just happened in the past month.
Speaker A:You refine it and you plan for the next month.
Speaker A:And I started with their time.
Speaker A:I made.
Speaker A:I. I didn't make.
Speaker A:I can't make anybody do any.
Speaker A:I suggested that every single person go through their calendar and break it down into how much time was spent on client work.
Speaker A:So with clients on calls, whether that was working on their work behind the scenes, if you're a done for you service provider on calls, if you're more in the coaching or consulting space or inside of WhatsApp or any of those asynchronous style communications, right?
Speaker A:How many hours were spent there?
Speaker A:Then look at how many hours were spent on marketing.
Speaker A:So networking, attending different, doing coffee chats, creating content, recording reels, editing reels, doing video, whatever that is, right?
Speaker A:Like how much time spent on marketing and then how much time was spent on admin.
Speaker A:So again, like even this podcast recording, how much time was spent on that, that could be marketing, it could be admin.
Speaker A:You could look at it both ways.
Speaker A:But because what I wanted everybody to understand is I want people to see how many hours they are truly spending every week in their business, right?
Speaker A:Like how many hours are you working on your business and how many of them are actually billable?
Speaker A:Because one of the other things that I see happen all the time is that people base their pricing off of like, okay, well I'm going to work, I have 30 hours a week to work.
Speaker A:And so they base their pricing off of 30 hours a week.
Speaker A:But 30 hours a week covers your admin time, covers your marketing time, covers your.
Speaker A:You know what I mean?
Speaker A:It's not all billable time, right?
Speaker A:It's not.
Speaker A:I mean again, we're not in the time for dollar trade.
Speaker A:But this is where profit comes in, right?
Speaker A:So how many of those hours were you actually spent on clients which are revenue generating?
Speaker A:So that's what you've got to look at.
Speaker A:So if you have 20 hours a week and 10 of those hours were spent on clients, right?
Speaker A:You really need to be pricing yourself at 10 hours available, not 20.
Speaker A:Because not all 20 are revenue generating hours, right?
Speaker A:And so this is where you can really start to manipulate your numbers a little bit so that you can truly build a profitable business, right?
Speaker A:You can really look at.
Speaker A:Because profit is what sustains you, right?
Speaker A:Profit is what allows you to scale.
Speaker A:Profit is what allows you to reinvest, it allows you to hire, it allows you to take time off, right?
Speaker A:We talked about all that.
Speaker A:Like you have to have profit built in because it is what truly gives you the ability to scale.
Speaker A:If you don't have profit, you can't scale.
Speaker A:You will cap out, you will continue to hit this revenue wall all the time.
Speaker A:So you've got to really look at it and see, like, am I operating from a place of just straight survival or am operating from a place of sustainability and.
Speaker A:Or am I operating from a place of scalability?
Speaker A:Right?
Speaker A:All three of them are different.
Speaker A:And you're likely going to hit all three of those different paths at some point in your business, right?
Speaker A:But if you start to find yourself in survival mode, right?
Speaker A:So like, at some point you could be sustaining, and then all of a sudden I'm just barely surviving.
Speaker A:That's likely because your business grew, right?
Speaker A:Your business grew, your, the number of clients grew, the number of hours you're spending grew, your expenses probably grew with it.
Speaker A:Like, as you, every time you grow, you start to cut down this profit margin just a little bit.
Speaker A:And so if you feel like you were in this, like really great groove of sustainability and you were feeling like you had the money and you could reinvest and you were scaling and then all of a sudden that's now getting smaller and smaller and smaller every month.
Speaker A:That means you're growing, right?
Speaker A:That means things are growing in your business, which is likely a sign that you need to sit down, reflect again.
Speaker A:This is why it's so important to do those reflection meetings to reflect and see like, okay, why all of a sudden is my profit decreasing?
Speaker A:Likely because your expenses or time has increased because of the growth in your business.
Speaker A:And so you need to reevaluate, reprice all of those things.
Speaker A:This is where those price increases come in.
Speaker A:So I want you to really be honest about your hours, your admin, your marketing, your deliverables, your clients, all of that time, really take that into consideration.
Speaker A:And then if you want to see if your offer is profitable, what I would do is take the price that you're charging for your offer.
Speaker A:This is the easiest place to start.
Speaker A:So if you don't want to look at your entire business model and see if that's profitable, that is what we do inside of the Focus Visionary or in the one to one work that I do.
Speaker A:The one to one work that I do is very deep where I do some of the analysis.
Speaker A:It's much more of a consulting role, the profit analysis, but inside of the Focus Visionary accelerator, I have all of these tools set up and created so that you can do these things on your own, especially as things grow.
Speaker A:And then obviously you've got me.
Speaker A:There is your support as well.
Speaker A:But one of the very easiest first places to start in your profit is to look at one specific offer.
Speaker A:So look at the offer that you sell the most.
Speaker A:Okay.
Speaker A:And then I want you to add up how many hours you spend inside of that offer, right?
Speaker A:So if it's a done for you service offer and you spend 20 hours on it, right?
Speaker A:Like let's say you have a done for you service offer and you're spending 20 hours and then you also have like a pre call or a post call or something like that.
Speaker A:So I'll give you an easy example.
Speaker A:Let's say you have a VIP day because that's an easiest business model, right?
Speaker A:So you have a VIP day where basically somebody is buying your, your service for the day, okay?
Speaker A:This is also one of the easiest scalable one to one models.
Speaker A:Just a heads up, it's one of the most profitable ones out there because people pay for speed and speed is profitable.
Speaker A:But that's a, that's a topic for another day.
Speaker A:But let's say you have a, a VIP day and you're charging fifteen hundred dollars for it, okay?
Speaker A:And now you work on that VIP day.
Speaker A:They have a full seven hours with you because it's technically eight.
Speaker A:But you take an hour for lunch, right?
Speaker A:Like you take a break, you're allowed to take breaks.
Speaker A:So it's seven hours of time that you're actually spending in with them, okay?
Speaker A:So you've got that.
Speaker A:But before the VIP day, you have a 45 minute call with them to kind of get an idea, make sure that you're doing that.
Speaker A:You guys are on the same page, right?
Speaker A:Then even before you start to work on it, you have another probably 45 minutes to an hour that you are spending reviewing all of their documentation, making sure that you have everything, looking at everything that they've submitted to you, right?
Speaker A:Okay.
Speaker A:So now you're, you've got that.
Speaker A:So now you've done the, now you execute on the seven days or the seven hours and then you have an off boarding, right?
Speaker A:So you maybe you jump on another 30 minute call with them to kind of show them everything.
Speaker A:Maybe you record a loom video.
Speaker A:It doesn't matter if you're doing it loom or you're spending the time on it, you're still spending it.
Speaker A:It's still time.
Speaker A:So you're, let's just be realistic here and say another 45 minutes in like getting and sending out the deliverables, okay?
Speaker A:And then let's say you offer a two week where they can do tweaks, like they can come back to you.
Speaker A:They've got two weeks to kind of come back to you with any changes or even if it's seven days and that on average is about another hour, maybe hour and a half of time where you're having to go in, make changes, anything.
Speaker A:Okay, so all of that, you're up to 11 hours.
Speaker A: Let's say you're charging $: Speaker A:Now you have divide that out by 11 hours, you're at $136 per hour.
Speaker A:Again, that doesn't include your expenses, that doesn't include your taxes.
Speaker A:The other thing is, is that doesn't include the time it took you.
Speaker A:That doesn't account for anything with marketing or admin like to actually find the client to onboard the client, anything like that.
Speaker A:Right.
Speaker A:So again, at $136 minus your taxes, it could be, you know, your, your after taxes and expenses, you're probably at about a $80, $80 an hour.
Speaker A:Right.
Speaker A:So $80 an hour times, let's say you want to work 30 hours a week, that's $2,400 times 52, you're at $124,000 again.
Speaker A:Are you still hitting your numbers?
Speaker A:Yes.
Speaker A:Is it profitable?
Speaker A:I don't know because again, you need to know your expenses and all of that.
Speaker A:But it's a, the easiest way to do that is to at least calculate your hours.
Speaker A:That was an example, the VIP day.
Speaker A:That's why I'm saying the VIP day is almost always a very profitable business model where we start to get into these business offers and like offer models that are not profitable are in the very long wind.
Speaker A:Like the longer done for you services, the coaching offers where you're spending a week call with them every single week and then they have access to you in between in WhatsApp or something like that.
Speaker A:You gotta make sure that you're priced for that.
Speaker A:Again, including all of your softwares.
Speaker A:Any if you have a VA that helps you, you gotta take all of that into consideration.
Speaker A:So that is one quick way is you can just simply do an audit on your offer and start there and really look at like, is my offer profitable in the first place?
Speaker A:Right.
Speaker A:And again, this again can get very convoluted.
Speaker A:This.
Speaker A:Maybe you have a cpa, maybe you have a cfo, they can do this for you as well.
Speaker A:But what they can't calculate for you is your hours.
Speaker A:So unless you give them your hours, they have no way of being able to calculate that.
Speaker A:So the hours are where you're going to see whether or not you're actually making a profit or if you're not.
Speaker A:And that's what you have to remember when you're looking at this.
Speaker A:And Making sure that you're pricing yourself to have profit.
Speaker A:Because again, profit is what sustains you.
Speaker A:Profit is what allows you to scale.
Speaker A:Okay?
Speaker A:So you want to remember, you pay yourself first.
Speaker A:You build a savings account.
Speaker A:You build like a savings or reserves for when life happens or when things you want to take time off.
Speaker A:And then you use your profit to reinvest intentionally back into your business.
Speaker A:You're not just building and buying whatever.
Speaker A:You're not just, you know, over overspending and over investing and all of those, that all of those things.
Speaker A:You want to really make sure that you have this consistent draw of income for yourself, right?
Speaker A:Not like I took a hundred bucks here, 500 bucks here, a thousand dollars here, how much do you want to pay yourself?
Speaker A:Right?
Speaker A:That needs to come first.
Speaker A:Then look at like, okay, again, savings account.
Speaker A:Like what is the savings account?
Speaker A:Your business needs a savings account the same way as your, your house and your personal needs a savings account.
Speaker A:Right?
Speaker A:And then what are some things that you want to reinvest in?
Speaker A:And I take all of those things when I do it with inside of fea, that profit calculator that I have, it takes all of these, consider things into considerations.
Speaker A:What are the things that you want to add on that you can't afford right now?
Speaker A:Right.
Speaker A:And we build all of those in because that's how we build the profit.
Speaker A:And we want to make sure that we're accounting for all of these things so that we are building our offers accordingly.
Speaker A:So anyway, what I want you to hear in this whole episode is that revenue doesn't equal profit.
Speaker A:Right?
Speaker A:And so we need to start talking about how much more profiting if you want to share numbers, like share numbers, yes, we can be proud of our revenue, we absolutely should be proud of our revenue.
Speaker A:But we need to make sure that that revenue is actually turning into profit, right?
Speaker A:That we are actually have something to show for it at the end of the day.
Speaker A:And that we're not just over spending and over giving and all of those things because that's what keeps people from scaling.
Speaker A:That is what keeps people from scaling.
Speaker A:So if you feel like you are kind of stuck and you can't figure out why you can't scale, it's likely somewhere sitting in your profit and your profit margin.
Speaker A:And so I would really look at that again.
Speaker A:Your P and L is going to show a profit margin that is likely overinflated because it doesn't take into consideration your hours.
Speaker A:I can't stress that enough.
Speaker A:I have told you that a million times.
Speaker A:Easy peasy.
Speaker A:If you really want to look at it is go back 60 days, you know, I do everything in 60 day increments.
Speaker A:And look at your hours, work and break it down into clients, admin, marketing, and then look at your revenue, look at your expenses, and then run the calculation and see where you're at.
Speaker A:See what the number comes up to and see if you're happy with that number.
Speaker A:If you're not happy with that number, then you make a change, right?
Speaker A:If you're happy with that number, keep going.
Speaker A:But if you feel like that number is less than what you would like, then you make a change.
Speaker A:Okay?
Speaker A:But the change is not just raising your price.
Speaker A:That's not always the answer, especially if ours is a problem, right?
Speaker A:Raising your price isn't going to just magically change your profit just because you raised it.
Speaker A:It's.
Speaker A:It's only gonna it.
Speaker A:That could be a temporary fix, especially if you're at capacity.
Speaker A:So anyways, if this episode is resonating with you, if you feel like somebody else needs to hear this, do me a favor, share it out on Instagram, take a screenshot of it, share it on your favorite platform, Instagram threads, I don't care, LinkedIn, even tell your friends about it because this is a topic I think everybody needs to hear.
Speaker A:And then again, if you want my profit calculator, I do have a free version.
Speaker A:It's very helpful.
Speaker A:It has a loom video with it.
Speaker A:I'm happy to send it to you.
Speaker A:Hit me up in the dms, just send me a message, profit calculator, whatever.
Speaker A:I don't care what you say, just send me a message and I will absolutely send it over to you completely free.
Speaker A:No, opt in all the things.
Speaker A:And then if you want to take this a step further, let's talk about what the options are.
Speaker A:I've got a lot of different options.
Speaker A:FVA is of course, the, the option that I always, always tell people to go into because it's the most comprehensive program with all of the tools built into it.
Speaker A:But if you're not ready for that, I've got some one off Async type offers too that could be very helpful.
Speaker A:So keep all of that in mind and I will see you and talk to you in the next episode.
Speaker A:All right, I love you, I believe in you and I will talk to you soon.
