In today’s episode, we wanted to share a training video Rodney Koop, founder of The New Flat Rate, recorded in 2017! But don’t shrug off this podcast; the content is still good. We like to say around here, “If it ain’t broke, don’t fix it.”
Rodney explains how to stay profitable in your service company using “Profit Grab Accounting” in this episode.
Here are three essential accounting tips to go from a struggling service contractor to a profitable business.
1. Project Your Profit
What is your projected profit?
You’re the boss; you most likely started your company. What do you want the profit to be?
Whether it’s 1%, 10%, 20%, etc., be honest with yourself.
If you’re actually making the profit you say you are, you should be able to take it out of the money that comes in.
2 . Prove That It’s Profit
When your service job is complete, take your target profit percentage and GET IT OUT of your general account.
You should be able to pay the material, your technicians, and the rest of your bills without your PROFIT.
If it really is profit, then you shouldn’t have to touch it.
3. Protect Your Profit
You worked hard for it, now use it to build your future!
We all want to use that extra cash on hand; it’s burning a hole in your pocket!
We justify the extra expenditures by saying we are “Investing in our business by buying these brand new power drills,” but then, at the end of the year, your bottom line is the same as the year before.
It’s hard to see those Benjamins growing and not touching them, but protecting that profit is KEY to growing your business!
To learn more… Watch or listen to this weeks episode!