So Happy Making 2% Net Profit. Really?
Should I be happy for you when you say that you made 2% net profit in my business? It’s good that it is green and not red.
Let’s do some math. You have a $500K business. Two percent Net profit is $10K. A $1 million at a 2% net profit is $20K.
It takes a ton of work to run a business today; managing more than ever and leading a team to greatness is also an art.
In this very short rant today, I want to point out that the survival of a business depends on your net profit. Many are happy to have a positive profit figure on the bottom of their Profit or Loss statement. It’s better than the alternative of a deep red hole.
Appreciating the impact and power of net profit is realizing how you can use it for the business. Things like new equipment and tools, upgrading vehicles, investing in your people, paying debt, adding services, and a dividend to the shareholder(s) come from profits.
Look at the numbers above. Let’s just consider you’ve started on a path to reenergize your CEO learning curve. You move into an uncomfortable zone of learning what you do not know and how to make money. So you do $1 Million, and your goal is to earn twenty percent. Now, your net profit would be $200,000. Just think of all you can do with that profit for the good of your people, clients, and the business.
We’ve dedicated the last eight years to helping Advance the Service Aftermarket. We have loads of content to help you appreciate more business success. Here is a group of episodes that can start you off on a higher degree of success. https://bit.ly/3GqH4oO
About the author, Carm Capriotto, AAP
Carm is the founder and host of the Remarkable Results Radio Podcast and the pioneer of automotive aftermarket podcasts. Carm calls on his years of experience in the aftermarket to bring engaging stories from his guests.
Listen to raw, unfiltered, honest, and sincere stories that include insights, trends, best practices, and expertise. Each interview brings an opportunity to learn one new thing through the stories of personal achievement. Many podcast guests tell their story of transformation from working in their business to working on it.
As host of over 1,000 episodes, Carm uses his enthusiasm and passion for the aftermarket especially the service sector to take his listeners on a journey showcasing successful service professionals’ paths to Remarkable Results. He also enjoys interviews with aftermarket industry thought leaders who bring their industry perspectives to his listener.
Follow the podcast on your favorite podcast listening app and always listen to learn just one thing!