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27 thoughts on “How to use the Profit First Accounting System from Mike Michalowicz (with FREE Spreadsheet)

  1. I just found you Joey! I am reading the book PROFIT FIRST on Audible. What attracted me to listen to you was your audio quality. I am an AUDIO VISUAL guy. I appreciate good video and good audio on YouTube. You sound like you know what your talking about too…

  2. Hi Joey! This was great! I think I will need to watch it again to fully understand all of the details,. Haha! Nevetheless, I was wondering what your thoughts were on doing this on a weekly basis vs a bi-weekly. I ask this because I have a service based business and each week, I have to "spend" money in order to provide services to my clients. So that counts as an expense, which sometimes happens before I bring in my income. How do I work around this?

  3. Thanks for the high quality video! Reading the book and the visuals in your videos help! Please do more videos on Profit First topics, thanks!

  4. Does this method work with an investor on board? Hes not a shareholder but he makes money 50/50 on certain products. Any advice would be great! Thanks!

  5. Why is there no mention of the creator of Profit First @mikemichalowicz? It’s almost like you’re reading from the book word for word but still no credit to its creator.

  6. This is just a more in depth version of the theories from the richest man in Babylon. Very well written out though, and a must use system for every entrepreneur

  7. As a hairstylist this is VERY helpful! I run my own business and I never truly understood where my money was going and what I was making. This method has kept me very organized and on top of everything! THANK YOU!

  8. So basically pay your business, yourself and the government first. If you're not making enough in sales to cover that, then your business is in jeopardy! Because that means that you don't have enough cash flow to
    A) Pay your business. This is the positive cash flow. You need at least 3% or more to keep up with inflation. You need to invest at least this 3% back into the business to grow your business. If you're not growing you are dying man!
    B) Pay yourself. You have non business bills to pay. You gotta eat! One idea is to try to make as many of your personal expenses into business expenses though. The less salary you take in, the less taxes you have to pay. But still, there will always be non business expenses so you need money to take care of them.
    C) pay the tax man. An utter nuisance, but it's part of life. Try to reduce this as much as you legally can (business expenses & tax breaks)
    D) Maintain your business. All the expenses to run your business day to day. If you have already forced a positive cash flow by paying your business and self first, paid the expense that could land you if jail if you don't, and you don't have enough money to cover the day to day then you gotta look again at your business and see what you are doing wrong. Refinance some deals, get that liability as low as possible. Restructure payments, reduce costs as much as you can so that instead you can spend the money into growing the business, more than running it.
    Plus you know leaving the life of your dreams is a huge plus

  9. Hey Joey
    Can you clarify, why wouldn't you take the £1k and be paid for 3 weeks instead of only 2? Yes, you'd be one week short until a greater injection of cash, but it's better than only being paid 2 weeks. Also, can you clarify, the owners pay is for us to pay all of our personal expenses, right? Thanks for this vid. It's way easier to understand than the 1st chapter of the book! Keep up the good work 🙂

  10. Nice video. Do I still need to read the book? I was on YouTube hoping to find an explanation like this so I wouldn’t have to read a book. Please advise.

  11. Hey Joe, Quick question for you. Would you not just take the 13% off the top right away. Then base your 15% income tax off of the $8700 remaining in the account? As the 15% isnt considered in your revenue?

  12. This is great. I'm 6 weeks into using the profit first thing and I've noticed one major change. That is that I actually have money in my account and I'm not worried about the expenses because the money is in the Operating Expense account.

  13. This is only applicable in a service based business. If my cost of sales is 3500 of that 10k sale leaving me with 500. I have expenses of 850. This model is total nonsense….this is a model of someone who is not actually in business

  14. Where should the money use to grow our businesa go for? Also, I am doing inventory business, I need money to restock everytime… how can I allocate the money for restocking?

  15. I found this video pretty useful. I think it's the same strategy from the richest man of Babylon but your example it's pretty cool. I like the way you explain everything. Good video. Thanks from Dominican Republic! 🇩🇴

  16. Awesome breakdown of the book sir! I to live in Ontario Canada and was wondering if you managed to get zero fees for the accounts?

    It’s great to see a Canadian explain this. I get lost at times when trying to find equivalents to advice given by people from the US.

    Thanks!

  17. Thank you for this video! I've been doing Profit First since the beginning of the year and I would like to add funds into my business.

    Should I put the amount in the Income account and allocate it to the different accounts on the 25th or put it directly in the Expense account?

  18. Joey, really helpful to teach entrepreneurs to manage their own money as I think most people have no clue. Great to understand how to pay yourself. If you can elaborate more on how to decide what expenses to cut off that'll be great!

  19. How would this work with a more complex business model, where there's loads of bills coming out throughout the month, multiple payroll dates, capital investments and significant depreciation etc etc?

  20. This really helped because with an audio book and just trying to use the sheet without the visual explanation was hard.

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