EPISODE: 062 – The Importance of Managing Your Money
The only way to ever have a truly successful business is to manage your money like a professional money manager. I’ve never been great at managing money, but despite that fact I’ve become very good about doing this thing that simply doesn’t come naturally to me, and it’s made an incredible difference in my business. I want you to do the same because I see the impact it has made on my life, my team, and our clients. It wasn’t easy, but it’s been worth it, and I continue to improve every day. Listen in and hear my plea for you to become an ace at managing your business’s money as well as your personal finances.
Thank you to RepairPal for sponsoring The Auto Repair Marketing Podcast. Learn more about RepairPal at https://repairpal.com/shops
The importance of managing money (00:01:03)
The significance of managing money in both business and personal life, and how it relates to the profitability of a business.
Money mismanagement in a church (00:01:57)
Brian shares a personal experience of money mismanagement in their church, highlighting the potential negative impact it can have on the overall purpose of the organization.
Understanding the true financial health of a business (00:05:18)
The limitations of relying solely on the profit and loss statement (P&L) to assess the profitability of a business, emphasizing the importance of considering other factors such as taxes, debt service, and assets on the balance sheet.
Timestamp 1 (00:07:11)
Managing Money and Operational Expenses
Understanding the difference between operational expenses and assets, and the impact on profitability.
Timestamp 2 (00:08:05)
Debt Service and Profit Margin
The impact of debt service on profit margin and the misconception of making money based on P&L.
Timestamp 3 (00:09:53)
Profit First System
Implementing the Profit First system for better money management and its positive impact on the business.
The importance of managing personal finances (00:14:50)
The need to manage personal finances effectively and the benefits it brings to business owners.
The role of a CFO in managing personal finances (00:15:48)
How having a CFO can help in preparing reports and managing personal finances efficiently.
The value of outsourcing accounting services (00:17:43)
Brian encourages business owners to lean on outside services, such as accounting professionals, to handle financial aspects of their businesses.
The importance of a 20% profit margin (00:20:37)
The industry standard of maintaining a 20% profit margin and the significance of running a healthy business.
Balancing profitability and employee raises (00:21:33)
The challenge of giving employees raises while maintaining a 20% profit margin and the importance of making decisions that prioritize the health of the business.
The benefits of running a healthy business (00:23:22)
The positive impact of running a healthy business on employees, clients, and the ability to provide quality service and warranties.
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