We all want to run a profitable business. Yet most of us simply don’t. But before we go any further, let me explain what I mean by “profit”. In accounting, profit is the result of what’s left over after subtracting our expenses from our sales. If we have $500,000 in sales and $400,000 in expenses, our profit would be $100,000, or a profit “margin” (profit divided by sales) of 20%.
You may know someone like this. He’s the guy with the fancy new car, kids in private school, living in the nicest house, with a pool, in the nicest neighborhood. The truth is, he’s probably living well beyond his means, up to his eyeballs in credit card (and other) debt, with very little in savings, and only one month away from bankruptcy.
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