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Is Your Business Making Money?

Is your business making money? Would you know?

Figuring out whether your business is actually making money is no easy task. Most small business owners have a pretty good idea of what their top line is (their revenues), but unless they're closely tracking and inputting all of their expenses, the bottom line can often come as a complete surprise. That's why it's critical to closely monitor these numbers on a monthly basis. They are the tools you need to make ongoing business decisions.

For example, a client of ours recently started a landscaping service. Although his sales were rapidly increasing, he was frustrated by the fact that it didn't seem to have much of a positive impact on his bottom line. By inputting all of his costs into the proper format, it became immediately apparent he wasn't charging enough for his services.

He thought that by charging his clients $20/hr and paying his workers $10/hr, the extra $10 would be his to keep. However, he forgot about all of the costs involved in actually carrying out the job starting with payroll taxes on the $10/hr, transportation costs, office overhead, and advertising. At his current rates, no matter how much business increased, he would never make any money.

The answer was to raise prices or get out of the business! Fortunately, he was able to raise prices without upsetting clients. Now, he can comfortably carry on his business and keep adding to his bottom line.

Fern Gordon is the owner of The Profit Line. Making sound business decisions means having a clear picture of your financial situation in front of you at all times - yet the daily demands of running a small enterprise can be overwhelming. As a result, financial record keeping and reporting often don't get the attention they truly deserve.
The Profit Line changes all that. We are your bookkeeping partner, helping you stay on top of your finances so you can make better, more informed business decisions.
In addition to taking paperwork off your plate, we also pinpoint the key numbers critical to the performance of your specific enterprise, and make sure you have them in hand whenever you need them.
The Profit Line

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