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Designing for Profit in 2023 (Sabrina Starling On Small Business)

3 min read

Over 85% of small businesses barely break even, or lose money, year after year.

If you are barely breaking even, or losing money, you likely are wondering, “Is this all worth it?”

Your business should be paying you in two ways:

1) As the owner of the business working in the business as an employee.

2) Giving you a return on your investment for the entrepreneurial risk that you bear.

In our work with small-business owners, it’s not uncommon for us to discover over $100,000 of untapped profit potential in the business.

That money exists in the business without the business owner or team having to do any extra work. Capturing that potential means streamlining the business to reduce waste, focus on a sweet spot, hire A player employees, let go of C and D players, put systems in place and align the team’s effort around serving the best clients within the sweet spot. 

When you focus on breaking even to survive, you are covering your bills and little else. 

Small-business owners often forgo vacations, saving for retirement, and purchasing life and disability insurance.

If you were an employee working for a company in an executive role, these are part of a compensation package you would receive. As a small-business owner, it’s important you take charge of providing your own benefits package. 

Refocus

I invite you to shift your focus from breaking even to thriving. Thriving means: 

• Paying yourself appropriately.

• Experiencing a return on your investment.

• Freeing up your time.

• Creating a great culture that attracts A players.

• Being able to invest in your team’s growth and development so it contributes to the business’ growth.  

This comes from learning how to design your business to be profitable. Starting with profit as the end goal changes every decision you make in the business going forward. Putting a system in place so that profit and owner’s compensation are paid first forces the rest of the expenses to adjust around those parameters. Limits force innovation, which in turn grows the business. 

It is possible to have a sustainably profitable business that pays you appropriate owner’s compensation for the work you do in the business and also generates a return on your investment. 

To learn more about designing your business to be profitable in 2023, listen to the Strategic Planning series on the “Profit by Design” podcast. You can download our Strategic Planning Workbook and access the episodes at tapthepotential.com/plan. 

Part 4 of the Strategic Planning series specifically focuses on designing for profit in 2023. 

Here’s to your profit (and peace of mind!) in 2023! 


Based in Arkansas, Sabrina Starling, Ph.D., is the author of the “How to Hire the Best” series, founder of Tap the Potential LLC and host of the “Profit by Design” podcast. Get more resources and tips at tapthepotential.com.
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