{Video} Can I Do Profit First On A Spreadsheet?

Are you a business owner that constantly checks their bank account to see how your business is doing financially? Do you have an accounting software you utilize or even a spreadsheet you use to track?

The Profit First Model must be set within your banking system. You can use your existing habits of checking your bank account with an added peace of mind and clarity on how your business is doing financially. 

Let’s hear more from Profit First creator and author, Mike Michalowicz on how you can best implement Profit First into your business through your bank. 

{If you prefer to read instead of watch, please scroll to the bottom for the transcript of the video}

 

Hi, I’m Mike Michalowicz, the author of Profit First, and I am so happy that there’s over 500,000 businesses that have implemented Profit First, and is growing daily. Unfortunately, there’s some myths that need to be busted. One of the most common myths I hear is that Profit First can be done on spreadsheets, or you can do it in your accounting system and you don’t need to do it in banks. Well, if you hear that, that person explained that clearly doesn’t understand behavioral intercepts because Profit first is a cash management tool that works with our natural behavior. I’ve surveyed hundreds of thousands of entrepreneurs, both formally through traditional survey and also at conferences I speak at, just by the raise of hands. And I ask people, entrepreneurs, how often do you check your bank account balances to see how much money you have and make financial decisions around it? 90% of the hands go up. Sometimes a hundred percent of hands go up. Most entrepreneurs are checking their bank accounts weekly, monthly, daily.

I mean, are you? It’s likely you are. And based on the money we see there, we make decisions. That’s why the Profit First system must be set for your bank. What we do is pre-allocate money to its intended use. So now you get to continue that behavior of logging into your bank account and you see what the money’s intended us is.

For years we’ve been told,

• “never look at your bank account”,
• “log into your accounting system, read the income statement, the balance sheet, the cashflow statement, tie those in together”,
• “know, the operating cash ratio, the inventory turn”,

all these things that will manage your business well, and it’s true, you will, but we don’t do it.

The key is not to change your behavior. The key is to channel your behavior and that’s what Profit First does. So make sure you set up the profit first accounts at your bank. You’ll manage your money better than ever before.