Sales Do Not Equal Profit
In our State of the Industry research, a third of boutique owners reported they do not know if they’re profitable. The problem with this is, if you don’t know where you stand - you can’t know where you’re going and how to get there!
As boutique owners, it’s easy to only focus on the monthly sales number. When it’s high it’s a celebration and that’s great, but oftentimes when it's posted on social media the whole picture is rarely shown. Rather than comparing yourself to other boutique owners, look at profit not just sales. Just because a business has higher sales than you doesn't mean they are profiting more than you.
Something that can often be forgotten is that sales don't equal profits. Track your profit because that’s the real number. How?
Profit is what you get to keep after paying the expenses of your business—and it’s not talked about enough. To increase profit, look at your reports and cut down on any unnecessary expenses, then look at what is working and what is not working and do more of what has a high return on investment (ROI).
Profit is what keeps your business alive and gives you the opportunity to support and provide for your family, and have enough to take time off to create memories together.
Monthly bookkeeping is how you can track your profits and use the information to make smart business decisions to increase your profit.
In summary:
Profits tell the true financial health of your business
Knowing your numbers helps you know your profits
Profit is what keeps your business alive
Sales are only half the story
Your profits are what give you the freedom to be with your family more
Your profits are sales minus expenses
Monthly bookkeeping is how you track your profits
Need to outsource your bookkeeping? Plus get free access to Understanding Your Reports - a monthly training with Lindsey, the founder of HarQuin. Fill out the estimate form here.