Mike Michalowicz is a highly renowned author and a serial entrepreneur who has already founded, grown, and sold two companies. Now, Mike is onto his third multi-million dollar venture, Profit First Professionals, an exclusive community of accountants, bookkeepers and business coaches who are certified in the Profit First methodology to help their clients build highly profitable businesses. This business is the culmination of the challenges and hardships Mike had to overcome after his investment business folded. He realized that too many business owners are living paycheck to paycheck, so Mike developed a solution that helps businesses become permanently profitable.
Profit First in the Dental Space
A common misconception among small business owners is that sales translates to profitability. But in reality, sales puts significantly more stress on business owners because it increases the obligations to deliver on those commitments. More obligations for owners/operators like dental practitioners means longer hours and less freedom. That is why Mike invented a tool that puts profit at the forefront. Most dentists do bank balance accounting, so when money comes into the practice, Mike’s system takes the profit out before anything else, hides it, and forces his clients to run their business off of the remainder of the money. It ensures the business is always profitable without forcing the dentist to make drastic changes in behavior, and it has been immensely successful in the dental field.
Always Room for Improvement
If your practice is doing well, there are sales coming in, and there’s money flowing through, there are still changes you can make to improve Mike’s system. One example of this is taken from the best practices of major corporations—quarterly profit distributions. In a small business, money flowing to the shareholder (the business owner) builds fiscal discipline. Another tweak dental practices can make is to prepare for their tax bill. Many small businesses are ill-prepared for their tax bills and fall victim to loss aversion because the payment is coming out of their own pockets. Similar to the profit percentage, Mike’s system pulls the tax bill funds ahead of time so that the business pays for it when it comes around. To learn more ways you can keep more of what you make using the Profit First Professionals system, listen to the latest episode of the Progressive Dentist.
As always, please visit me at www.theprogressivedentist.com for more informative podcast episodes with other remarkable business leaders.