Escaping the Revenue Trap: A New Era for Accountants and Bookkeepers
In this episode, we unveil the Profit First Pathway, our newly rebranded pre-membership experience for accountants, bookkeepers and coaches who are ready to take control of their own business finances before guiding clients to do the same.
Formerly known as Croissants & Coffee, this new direction is far more than just a name change. It’s a call to action.
You’ll hear from Deb Halliday and Jason Withers as they candidly explore a common yet overlooked issue in the industry: making impressive revenue... but having little to show for it.
Why are so many professionals hitting six figures yet still feeling broke?
How can you move from surviving to thriving with fewer clients and more profit?
This episode dives into real stories, mindset shifts, and the first intentional steps you can take towards becoming a fully Certified Profit First Professional.
If you’re tired of working yourself into the ground and still not paying yourself what you're worth, this conversation is your sign to do things differently.
Episode Takeaways:
- The Profit First Pathway is designed for those accountants, bookkeepers & coaches not yet ready for certification but eager to transform their own business finances using the Profit First method.
- Revenue ≠ Profit. Many high-earning professionals still struggle with stress and low take-home pay.
- Learn how to translate complex financial decisions into clear, human language your clients (and you!) can actually act on.
- Discover the power of community-driven support and collaboration among fellow professionals on the same journey.
- Begin building a business that pays you, not just your bills.
Transcript
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Speaker B:Welcome to Profit first beyond the Book, a podcast that takes you beyond the book with Profit first brought to you by Tim Duncan and the rest of the Profit First Professionals UK and Ireland team.
Speaker B:Hello and welcome to another episode.
Speaker B:And I'm really excited today to be joined with my colleagues in the Profit first team of Jason and Deb.
Speaker B:Thank you for joining me, both of you.
Speaker C:Morning.
Speaker A:Morning.
Speaker B:An enthusiastic start to the show.
Speaker B:So what we wanted to do today was kind of talk about what we call a Profit first pathway.
Speaker B:We've.
Speaker B:We've unapologetically changed and rebranded what was Crossings and Coffee into the Profit first pathway.
Speaker B:Now, this is a pre membership group for accountants, bookkeepers and coaches that are interested in becoming Profit first professionals, but perhaps for one reason or another, aren't quite ready to take that step or not quite in the position to be able to take that step right now.
Speaker B:So the intention is that we help guide some of you to make you ready to join us if that's your intention long term.
Speaker B:So before Jason and Deb, before we used to run a group called Cross and Coffee, which everybody used to think was a nice name because we used to have meetings at 9 o' clock on a Friday, hence the name, but it didn't really explain anything about what we did.
Speaker B:So then we rebranded it to Crossloads Coffee and Profit first and it still didn't really feel like it was hitting the right area.
Speaker B:So now the last, you know, this last sort of few months, we've rebranded to the Profit first pathway.
Speaker B:I feel that it says what it is on the tin more.
Speaker B:Would you, Jason, would you agree with that?
Speaker C:Absolutely.
Speaker C:I think croissants and Coffee was a fabulous environment for, for a Friday morning and it was always great conversation, but I think one of the aspects about it for me was that moment of what is the intentional behavior we're trying to help other people create in their lives.
Speaker C:I think the switch into the, the rebrand for Profit first pathway, I think, as you say, absolutely says what its intention really is, getting on that pathway, you know, to getting Profit first into your own business, joining us as a member down the line maybe, and then taking things from there and really creating that impact for, for more businesses, fundamentally.
Speaker C:So, yeah, far more intentional output, I think now.
Speaker B:Yeah.
Speaker B:Thank you.
Speaker B:And I want to be clear, you know, the Profit first pathway is a group, it's a pre membership group and what we're trying to do within this group is help the members understand how to implement Profit first in their own business to a point.
Speaker B:They're not certified Profit First Professionals at this stage.
Speaker B:So they are not licensed or able to share this knowledge with their clients until they join Profit First Professionals as a fully fledged member and go through certification and continue membership.
Speaker B:That's when they are fully licensed and they're able to explain to their clients about Profit first and start delivering all the Profit first strategies that we teach them.
Speaker B:And we do teach quite a lot of strategies that you don't get from the book.
Speaker B:Very apt given that the podcast is called Profit first beyond the Book.
Speaker B:And that is the point of this podcast as well, is to, is to, you know, share some of the strategies that perhaps we don't share every day, but what we've learned through our experience of members.
Speaker B:But for many accountants and bookkeepers, it's quite a big step to join Profit First Professionals.
Speaker B:And I found that with having lots of prospect calls and I quite often come across people and I think you're not actually quite ready to join right now.
Speaker B:So even they might want to join.
Speaker B:But I'm probably saying I don't think you're quite ready.
Speaker B:I think you need to build your business up a bit more or perhaps you're very early stages.
Speaker B:Let's have.
Speaker B:But, but I didn't have somewhere to, to help them.
Speaker B:But the Profit first pathway gives us that place that we can say come and join this group, get involved, join our sessions and then we can help you grow your business and get yourself to the point.
Speaker B:Deb, we come across quite a lot of accountants and bookkeepers that have perhaps achieved six figures in their sales revenue or are looking to achieve six figures in their sales revenue.
Speaker B:But doesn't necessarily mean once they've done that that they've improved their profitability or how much to take from the business, does it?
Speaker A:No, it doesn't.
Speaker A:A lot of the people that I'm speaking to in our community have reached the six figure mark.
Speaker A:But actually it's just creates a lot of stress.
Speaker A:So I'm finding that a lot of my colleagues are not understanding what's going on underneath the, the top line revenue and they're not taking as much money as they thought they should be by this stage.
Speaker A:Their overheads, as in their team costs or subcontracting costs are way over what they should be and it's just eating in to any, any kind of profit.
Speaker A:Again, they haven't got that, that, that model.
Speaker A:All they've got is that target at the top that says hit six, six figures.
Speaker A:But what does it say about what's going on underneath?
Speaker A:I Mean you could just be working and working and taking on more and more and more clients and it's just that hamster wheel, there's, there's no reward at the end of it and it just leads to burnout and frustration.
Speaker A:And they do feel as though being bookkeepers and accountants that they're looked to to know how a business works but because that's where that why their clients are coming to them and they're fixing their clients businesses or they're hoping to, but they, they're not looking at their own numbers.
Speaker A:So yeah, so that's why I think it's important to, to show what profit first pathway and profit first professional membership offers.
Speaker A:And yeah, we can go into that, but yeah, it's, it's definitely not talked about, not offered and really desperately needed, I would say.
Speaker B:Yeah.
Speaker B:And if you, if you think about it logically from a profit first perspective, going right by the book right now, if you looked at the target allocation percentages for someone with a revenue of 100k, say they get to 6 food, so they've got £100,000 sales revenue, shouldn't they be paying themselves £50,000 salary from, from that and £5,000 profit?
Speaker B:So shouldn't your first target be how can I get my salary to say £50,000, how can I get there first?
Speaker B:Not how can I get to 100k sales revenue?
Speaker B:Because creating sales in some respects is a lot easier than creating the right reward from a business for yourself.
Speaker B:I'm not saying that 50,000 pound is the target ongoing, by the way, but I'm saying the initial target, if you're a new accountancy booking business, if you're below the six figure turnovers in your annual, trying to achieve that, actually maybe you should reassess what your target is.
Speaker B:How can I structure my business in such a way that I can firstly earn enough money to cover the bills that I need for my personal commitments, Then can I get to say £50,000 and in the background with a 5k profit building up, which I'm going to reward myself from by the way, as well as build up cash reserve Once you achieve that target, then how can I, how can I improve on that?
Speaker B:How can I double that?
Speaker B:You know, how can I take 100k for my business?
Speaker B:What does my revenue need to be to get there?
Speaker B:So Jason, do, do you think these are the key points that we talk about with our members on an ongoing basis, but also we've started to introduce these concepts in the profit first pathway on our five Friday profit first challenge recently, haven't we?
Speaker C:Absolutely.
Speaker C:I think it is.
Speaker C:I think there is a.
Speaker C:There is an interesting cusp point with people when they start their business.
Speaker C:There is undoubtedly a need to get clients and get money coming in.
Speaker C:I think the trap that then follows on from that is once you're on that hamster wheel, the hamster wheel just seems to continue.
Speaker C:It's like, I need another client, I need another client.
Speaker C:And actually we end up getting sucked into a world where we think more is the answer and quite often it just isn't.
Speaker C:I think that it's one of those things that people never actually get to that moment of sort of reassessing.
Speaker C:There is a continual chase for.
Speaker C:And then it becomes the, ah, I've got too much work on for myself.
Speaker C:I need to bring someone in to help me, whether that's employee, whether it's subcontractor.
Speaker C:So all of a sudden we end up paying the other person because we need to pay the other person to get them in to help.
Speaker C:And that actually reduces our own ability to think about what's left for us.
Speaker C:So I think that this is true of accounting and bookkeeping businesses that we see as people go through certification.
Speaker C:It is a common set of circumstances and I would also say is a primary reason when people become conscious that that is the place they're in.
Speaker C:That does tend to be the trigger moment for them to say, okay, I need to recalibrate, I need to reassess, and I need structure and a framework to help me move forward.
Speaker C:Because the framework and the structure has never appeared in the first place.
Speaker C:Because it has just been the continual chase ultimately for clients and revenue.
Speaker C:Like we all need money to live.
Speaker C:Let's not skirt around that issue.
Speaker C:But I think it's also one of the reasons that in my own world, as I've worked with clients through Profit first over the last six or seven years now, it is the reason that I've changed my emphasis from profit first as the whole to the result that the business owner gets from the work that we do.
Speaker C:Because I know that if we focus on making sure the business owner is not getting left behind as that business grows, I know we're going to solve a lot of the other things along the way.
Speaker C:We'll get the tax allocation right, we'll look at the OPEX side of things, we'll look at how they think about direct costs and cost of delivery.
Speaker C:I know we will address those issues as we go.
Speaker C:But I want really the focus on the business owner understanding they are in business to get a return for themselves sounds incredibly selfish, but the reality is that's why we do it.
Speaker C:We think we're going to get a return for ourselves.
Speaker C:So let's not hide away from that one.
Speaker C:Let's get it front and center and say, yeah, there is no reason why accountants and bookkeepers cannot get themselves into a position to pay themselves much better rates than they generally currently do.
Speaker C:So yeah, I think it's, it's incredibly important that we've started down this journey within the first couple of weeks of the profit first pathway and the challenge that we're running to focus on owners pay in week one.
Speaker C:It is incredibly important we want these business owners to be incentivized to do more because they're a enjoying what they do, they're great at what they do and there is no reason why they shouldn't get paid properly for what they do.
Speaker B:Yeah, I couldn't agree more.
Speaker B:I could see Deb vigorously nodding our head at that as well.
Speaker B:Deb, Deb, you and me, we, we've had experience running our own.
Speaker B:I had an accountancy booky business, you've had a bookkeeping business.
Speaker B:I can remember being in this position before I found profit first.
Speaker B:So, so what I want listeners to understand that we, we say this from a point of experience.
Speaker B:You know, I was that accountant that was, sat in an office on his own as the, as the darkness came down, you know, because it was another long day, sat in the office, you could, I could look out the window and see all the other businesses in the, in the place that where I was was set had gone home.
Speaker B:The car park was empty.
Speaker B:I'm still there, I'm still working.
Speaker B:The couple of people are working for me.
Speaker B:They'd long gone, they'd long gone home.
Speaker B:You know, I'm still there, I'm still got my head in my hands, buried in numbers, trying to keep on top of the compliance work going out the door, making sure we didn't miss the deadlines.
Speaker B:And I knew something had to change.
Speaker B:Now I'm quite confident there are going to be many accountants and bookkeepers that will hopefully be listening to this feeling.
Speaker B:Yeah, that's me.
Speaker B:And you know what if it is you?
Speaker B:There is a route out of this, but there are a lot of people out there at the moment trying to sell a dream.
Speaker B:We're not trying to sell a dream, we're trying to actually sell what?
Speaker B:Well, we're not selling anything actually.
Speaker B:We're actually trying to provide real life experience to share with you so that you can follow the pathways that we took that took us from that moment of head in, hands, putting hair out, you know, face planting on the desk because you just can't take any more.
Speaker B:You know, these moments have really happened for me and I, I'm now business partner to Mike Mikanovich who wrote the book.
Speaker B:Turning that first page of the book is what changed my life for me.
Speaker B:Starting to, you know, digest the first couple of chapters and then becoming a profit professional changed my life.
Speaker B:And now I'm license holder with, with Duncan in the, in the, in the UK and Ireland.
Speaker B:So it feels like that's a massive step, but it took time.
Speaker B:Everything takes time.
Speaker B:And with small steps forward following framework that Profit first provides through Profit First University and through the support that we provide, anything is possible and you can make it what you want to make it.
Speaker B:So I've probably gone off on a bit of a tangent, but I just want listeners to understand we actually do care because we've been there.
Speaker B:And the reason the product first pathway is there is because it gives you a first step without too much commitment, but it gives you a first step where you can actually dip your toe in water.
Speaker B:Learn more about Profit first, maybe learn a few things that you don't get from the book and then you can consider whether membership as a fully certified profit professional is for you.
Speaker B:I would suggest it's for most, but it doesn't mean that you would get accepted as a member.
Speaker B:You have to kind of prove yourself as well.
Speaker B:So there is an element of an application process for people to go through.
Speaker B:Deb, do those what I've talked about briefly, does that resonate with you, with your business, from you?
Speaker A:Yeah, absolutely, absolutely.
Speaker A:I mean, me finding Profit first, the book and the framework to work towards.
Speaker A: ause I tried it already since: Speaker A:And I knew I had to build a team.
Speaker A:How do you build a team without it eating into the money that you're taking out of the business?
Speaker A:So I looked at the framework and I took inspiration from the framework and realized that I could do it on a percentage basis.
Speaker A:So as I brought in a client, I knew that if I paid the subcontractor 30%, I could actually take on a client and pay as I took on a client rather than employing somebody that was going to cost me a couple of thousand a month or whatever that probably didn't have.
Speaker A:But I needed to have it because I couldn't do everything myself.
Speaker A:So I couldn't take on Any, anybody, any more sales, any more clients and you quickly get capacity.
Speaker A:So it was, it was great having that structure that I knew that if I sold with all percentages in place and added the 30% on top of that, and that gave me a baseline, a minimum that I should be charging the client and then you can work out how many clients you need to have, how many hours you want to work, how much your average sale or average client fee should be and you have a structure to work towards rather than just going blind and just chasing that sale and then finding that you've got your head still in your hands but you've added another 2, 3, 4,000 pounds worth of revenue.
Speaker A:So it's, I mean the structure is just amazing and it just gives you clarity.
Speaker A:And I think with the profit first pathway, I think the way that we go into people's businesses and really help them with that structure in their own, in their own business and give them the confidence, it's also a bit of, we're giving them the advisory that they're desperately, that their clients desperately need, but there's nobody around to give it to the accountants and bookkeepers.
Speaker A:So that's why we're standing up and saying we're doing it.
Speaker A:You know, if you, if you need our help, if you think you want to have better, better relationships with your clients, get into, involved in all the numbers of your clients role and just telling them the disappointing news about their tax bill, then we go through that with you within Profit first professionals and it gives you the first hand experience of how the advisory should or could be delivered rather than just a framework of a step by step process that you take your client through.
Speaker A:It's actually you get to experience that in your own business.
Speaker B:In our, you know.
Speaker B:Thanks Deb.
Speaker B:It's spot on in our, in our within Profit First Professionals when people have gone through the certification program, we move them into a new cohort which is kind of post certification, whatever you want to call it.
Speaker B:But all our members are actually invited so anybody can come.
Speaker B:And what we've been doing in that group, Jason, is we've been asking our members to produce a profit assessment for a client and deliver it live on the call.
Speaker B:But just for clarity, we don't expect the client's names to be shared.
Speaker B:So we're just looking at numbers.
Speaker B:To us it's just numbers about a business that we don't know.
Speaker B:But we've had some really interesting conversation on those calls, haven't we Jason?
Speaker C:I think one of the great reminders is There are always points that we can take from learning.
Speaker C:And I think, Tim, it's fair to say that you and I also learn from our members on an ongoing basis.
Speaker C:They're applying profit first with clients in their own business.
Speaker C:They're coming up with strategies, structures, ideas all the time and sharing those within the community at large.
Speaker C:And yes, particularly on some of these calls that we're running on a Monday morning now, but I think just the idea that we are providing a platform to do a core part of a profit first assessment, getting people to get more confident in delivering that, getting them to see different angles that, that those figures can be assessed from and some of the different ideas that come up, it's strength in depth.
Speaker C:The more iterations we do, the more reps we go through, the more confident we come, the more we see, the more valuable the advice comes because we know we're approaching it from a broader range of perspectives.
Speaker C:I think it's, I think there is a, there is an issue at the moment.
Speaker C:Generally it's like everything seems to be pointing towards being an advisor.
Speaker C:Well, okay, that's fine.
Speaker C:But if you don't actually know what you're going to say as an advisor, calling yourself an advisor doesn't really work.
Speaker C:And I think that one of the things that we are doing in these 11 o' clock calls on a Monday at the moment with the members is giving them the ability to strengthen as advisors and provide a greater depth of advisory services.
Speaker C:Quite genuinely, always got something to say, know where they're going, know where they're trying to lead a client.
Speaker C:That commercial mindset about a business is actually happening in the future.
Speaker C:What's done is done.
Speaker C:Yes, we can learn from those breadcrumbs of history, but a client's business is happening in the future and that is where the advisory work happens, helping people go through practice.
Speaker C:The reps with these profit assessments, looking at things from a commercial perspective about where they can take a conversation with a client that will help that client's business grow in a safe, sustainable, profitable way that delivers more for the owner.
Speaker C:Ultimately, at the back end of that is an invaluable service.
Speaker C:And I think one of the great things about it is it's not only you and I inputting to that conversation, it is the other members who are analyzing, looking at things, thinking about possibilities all the time.
Speaker C:They are finding an opportunity to strengthen their own advisory game just by seeing what other people are doing and sharing those ideas.
Speaker C:Incredibly important part of the process for me.
Speaker C:And I think it's, it's why Profit first as a proven global framework has the success it does both with members, businesses and with their clients.
Speaker B:Yeah, this is, I, I find those cores, you're right.
Speaker B:We do learn, we learn off of the cause.
Speaker B:We learn off, of course we have with our members.
Speaker B:We learn off of our group member calls, our community calls that we have when everybody joins us.
Speaker B:Because all of our members are entrepreneurial in their own right and they've, they've seen what Profit first can do to their own business first and foremost and they've enhanced the finances of their business, let's say, or they fixed the problems within their, their finances by joining us and going through the certification stage.
Speaker B:And then they've learned how to help their clients.
Speaker B:And by helping clients, you learn even more because you get asked questions, you know, by, by imagine going to a client and saying, you know, you've just been on the, the members call where we've gone through a profit assessment, you know, so we've looked at the numbers of the client and we've looked at areas that perhaps need support.
Speaker B:Imagine going to your client and saying, yeah, I was looking at your, your figures from a slightly different perspective to, to what other accountants, bookkeepers do.
Speaker B:And I found a couple of areas where I think I can support you.
Speaker B:Would you be open to a conversation about that?
Speaker B:Imagine that being a, at this stage, a once a year compliance only, you know, client that you've been trying for a long time to try and perhaps provide a monthly service to.
Speaker B:You're just asking for a conversation with them, aren't you?
Speaker B:And then you, and then when you do have the conversation, you deliver some value.
Speaker B:Now everybody calls advisories become this almost, almost a difficult word because no one really knows what it means.
Speaker B:And clients don't care, they don't care what it's called, do they?
Speaker B:Is it advisory?
Speaker B:So I actually like to think it's about making an impact.
Speaker B:If you can make a positive impact to your client's business and your client's life, you're doing a great job.
Speaker B:And it's almost your duty to do that because you have the power and the ability to, to provide that service to your clients.
Speaker B:And the way to provide that service to your clients, the easiest way to do it is through the Profit first framework and Profit first structure.
Speaker B:Because by looking at things through the Profit first lens, it gives you so many options.
Speaker B:I think I shared with you both that I was on a call with Mike the other day and his words were Profit first doesn't fix your business.
Speaker B:It Shows you the areas you need to fix in your business.
Speaker B:And I just thought that's come from the man himself.
Speaker B:And I was blown away by it because I've never thought of it like that myself.
Speaker B:So again, we're still learning and we're able to share that learning in that ripple effect down to our members who can then talk to their clients.
Speaker B:But also now we can share it in the Profit first pathway with our pre membership group that are in there and they can actually think about that only in the perspective of their own business.
Speaker B:But at least, let's be honest, accountants and bookkeepers really need help with their own business first and foremost.
Speaker B:Because Deb, you raised a great point, I think earlier when you said, well, accountants of bookkeepers are trained, they go through a lot of exams and technically all the rules, etc, the compliance, the tax rules and regulations, various, very clever.
Speaker B:Necessarily know how to run a business?
Speaker A:No.
Speaker A:And they don't also know how to talk about a business to a business owner necessarily because we've also been done all the bookkeeping and the, and the accountancy exams.
Speaker A:But it's all jargon.
Speaker A:I mean a lot of clients don't need, don't know the difference between gross profit, net profit, ebit, they have no idea.
Speaker A:So Profit first is a system where it talks in the real world language.
Speaker A:Everybody knows what tax means, everybody knows what owners pay means.
Speaker A:It's not called dividends, it's not called, you know, it's, it's talked.
Speaker A:So it gives you a, a structure and a language that relates and that is welcome.
Speaker A:It doesn't close the business owner's ears when you start talking because they don't feel stupid that they don't understand what you're talking about.
Speaker A:And maybe they feel as if they should understand this terminology and should understand what a balance sheet looks like and how to read a profit and loss.
Speaker A:But we're talking to them in real world simple language, which is why it's so popular.
Speaker A:I mean the book is the number one business money book for business owners for the last decade.
Speaker A:And there's a reason for that.
Speaker A:It's because they don't want to come to their accountant and learn about all the different technical jargon that we've all done our exams and all look at management reporting that we're also proud that we've created all these graphs and spreadsheets.
Speaker A:They don't want to see it, they just want to know what they can spend their money on, how much they can take out.
Speaker A:Profit first does that and it reminds Us as advisors or the expert to talk to the clients in their language.
Speaker A:Whereas it's very difficult to do that when you've got a set of management reports.
Speaker A:How do you translate that into a language?
Speaker A:Easily, you don't do it.
Speaker A:You just blind them with jargon.
Speaker B:It's like.
Speaker B:It's coming to my mind when you said that management accounts, reports created by accountants, understood by accountants.
Speaker B:And it kind of stops there, doesn't it?
Speaker B:And that's, that's not meant in an offensive way because I'm, I'm traditionally, I'm an accountant, you know, I was doing the same thing.
Speaker B:Isn't it great?
Speaker B:Here are, here's your monthly.
Speaker B:Here's your monthly.
Speaker B:Here's your accounts, and here's your monthly management accounts.
Speaker B:And I've, you know, extrapolated figures to make it out to the end of the year.
Speaker B:Let's see what happens.
Speaker B:There was no kind of, okay, how do we make this happen?
Speaker B:Whereas with profit first, you know, let's be honest.
Speaker B:What, what do business owners do?
Speaker B:Where do they look if they want to buy something, where do they look first?
Speaker B:You know, they look at their bank account.
Speaker B:Have I got enough money to buy this?
Speaker B:No, there's money in the bank account.
Speaker B:I'll go and buy it.
Speaker B:Great.
Speaker B:Two weeks later, monthly salaries are due to be paid.
Speaker B:Oh, damn.
Speaker B:I shouldn't have bought that thing because I've got enough money to pay the salaries now.
Speaker B:What am I going to do?
Speaker B:Oh, I'll put some money in from my, for my, my personal money in, or I use my personal credit card or I'll get a loan out quickly, just temporary.
Speaker B:So I better pay myself back next month.
Speaker B:It'd be fine.
Speaker B:Come to the next month.
Speaker B:You can't pay yourself back, you know, and suddenly you're, you're at home now paying yourself, you know, what you can for your business, but you've got another debt to pay because you've put the money into business because you shouldn't have bought something in the first place, but you got excited and thought you could afford it if you, if your bank account's got less money in.
Speaker B:But you know, there's pots that profits building up and the owner's pay is building up and the tax is building up in, you know, you know, you can't touch that money because that's specifically set aside for a purpose and with intent, which I think is the word Jason likes to use.
Speaker B:So, you know, that's the difference, isn't it?
Speaker B:A business owner can make clear decisions by looking at his bank account.
Speaker B:Because not all that money is in there.
Speaker B:There's less money in the operating expenses to run the business.
Speaker A:Yeah.
Speaker A:And if they're unsure, they can still ask you in the language that they're understanding.
Speaker A:They can say, and we can ask them, well, how much have you got in such and such pot?
Speaker A:How much have you got?
Speaker A:You know, and they're not worried about asking questions that they're going to get a different answered in a different language or worried if they're asking questions they should really know the answer to, or is it a silly question?
Speaker A:You know, it's just, you know, it's basic, simple framework, the structure, and it's us translating their numbers into a universal language.
Speaker A:That's what we're doing.
Speaker A:And then we're planning for the future on that basis.
Speaker A:So all parties can read the map.
Speaker B:Yeah.
Speaker B:There cannot be an accountant or a bookkeeper listening to this that has never had a client come to them and say, but I don't understand how I've made a profit.
Speaker B:I've got no money to show for it.
Speaker B:It's impossible.
Speaker B:There cannot be one.
Speaker B:I really challenge that out there.
Speaker B:That can't be someone who's never had that said to them at some point.
Speaker B:But Profit first delivers the answer because the money is building up for the profit.
Speaker B:You actually have that money in a pot and we reward ourselves each quarter.
Speaker B:Yes.
Speaker B:And we use some of that to create a cash reserve emergency fund, et cetera, etc.
Speaker B:Yeah.
Speaker B:That's more of a technical detail we can talk about another time.
Speaker B:But, but it's always that question, isn't it?
Speaker B:And it's that, oh, congratulations, you made a profit, by the way.
Speaker B:That means you've got a tax bill.
Speaker B:You know, it's that classic conversation.
Speaker B:I can't.
Speaker B:I find it hard to believe that no one has had, you know, every single person that runs an account.
Speaker B:So book reviews must have had that conversation at some point.
Speaker B:This takes this away from a proactive point of view.
Speaker B:And Jason said about always looking into the future and that's exactly what profit from first professionals do.
Speaker B:Jason, we, we, we, you know, we've talked about, you know, my, me being an accountant in the past before I found Profit first struggling.
Speaker B:Deb in a similar position with her bookkeeping business before she found Profit First Struggling Profit first helping to solve the problems in our business first and foremost.
Speaker B:And that's part of what the Profit first pathway is all about as well.
Speaker B:To it, to a degree would be totally honest.
Speaker B:To a degree, you know, we're not going to do full implementations unless you're a certified profit professional.
Speaker B:That's, that's life, you know, that's the way the world works.
Speaker B:But we do give a lot of value in the Profit first pathway and we all get excited.
Speaker B:So we probably share a bit more what we mean to sometimes as well because we generally do want to help people.
Speaker B:But Jason, we've had experience, you know, you've been working with me within profit versus professionals as well for quite some time now, guiding people through certification and we have had experience, you know, of our members going through the implementation of profit first.
Speaker B:And is there any that you can reflect on?
Speaker C:I think one of the things I would touch on here is having having a bigger business does not necessarily solve any of the things that we have been talking about so far in this episode.
Speaker C:So you know, you mentioned like that 6 figure, it seems like an obvious target.
Speaker C:It's what everybody talks about in the online world.
Speaker C:Could we get to see six figures?
Speaker C:Fantastic.
Speaker C:And then actually people just make a problem, a bigger problem by growing their business in exactly the same way.
Speaker C:It actually just becomes a bigger problem, the hole gets deeper.
Speaker C:And I, I would go back to one of our members and this was a, you know, decent multi, 6 figure 4, 500,000 a year turnover, practice owner taking a thousand a month, no more money left.
Speaker C:How on earth can you find yourself in a position of running a half a million pound business and taking a thousand pound a month, barely using up your own tax free allowance?
Speaker C:And I think that one of the interesting things that I've always thought is that, is that when people read the book and they do what Mike asked them to do, drop me an email, tell me you need some help and I'll find someone to help you.
Speaker C:That is a massive step for what I would consider like my end clients and our end clients that we've had in the past.
Speaker C:That is a huge moment for people to say, do you know what?
Speaker C:Hand up.
Speaker C:I'm admitting I might just need some help here.
Speaker C:And I think that it is one of the things that people get to this point and there is no shame in asking for help.
Speaker C:We're quite reserved here in the UK about doing that out in the States.
Speaker C:They're amazing.
Speaker C:It's like, can you help me?
Speaker C:How much does it cost?
Speaker C:Okay, let's do that then.
Speaker C:If it gets me to a better place, they are willing to pay for the expertise to get them to that next place faster.
Speaker C:And I think we have this real reservation here certainly in the UK where it's like, yeah, but if I put my hand up and say I need some help, that's like admitting failure.
Speaker C:And it's like, well, there are degrees of failure and most of these failures can be resolved in the mind.
Speaker C:We just have to get to a point of saying, do you know what?
Speaker C:Something is off here.
Speaker C:And I can't quite see it, I can't quite structure it in my mind.
Speaker C:I just, I don't know what the missing thing is.
Speaker C:I don't know why this doesn't work anymore.
Speaker C:And I think that process that we take people through, definitely through certification, there are always eye opening moments for people.
Speaker C:But I think particularly as we're addressing things in the profit first pathway at the moment it is, let's get back to this idea.
Speaker C:We are in this, probably in week one we did an exercise about what would you do if you had more time and more money?
Speaker C:The two things traditionally that people think they're going to get loads of when they start their own business.
Speaker C:And it never quite seems to work out that way.
Speaker C:And then we start talking about how much are you actually getting out of your business?
Speaker C:We are getting people to a point of going, do you know what?
Speaker C:I'm not getting as much as I would like.
Speaker C:What would I need to fulfill that list of things I would do if I had more money?
Speaker C:What does that really look like?
Speaker C:So this degree of recalibration, there is absolutely no shame in it.
Speaker C:I mean I would look at my own business and say historically pre profit, first time for money, working hours, billing by the hour, these kind of things.
Speaker C:Even for the kind of coaching and, and CFO kind of work I was doing at that point in time, it has given me structure.
Speaker C:I was running a feral, uncontrolled business, doing okay, paying myself okay as it happened.
Speaker C:But luckily I would probably admit profit first has given me structure to be intentional about what comes next, how I think about doing things, how I focus on can I pay myself more.
Speaker C:These kind of ideas come out, they are readily available.
Speaker C:We help people with this all day long.
Speaker C:People going through certification.
Speaker C:And I think the profit first pathway provides people with the opportunity to have a, I'm going to say a soft start as it were, you know, nice community of people.
Speaker C:I go back to that kind of what crossings and coffee was like on a Friday morning.
Speaker C:A nice affable environment, everybody gets along, it's all fine.
Speaker C:But it gives people the opportunity to take that soft start, test some things, see where they are, think about whether or not this is opening up those kind of Thoughts of saying, do you know what?
Speaker C:Actually, a bit more help here.
Speaker C:I can see that there is structure.
Speaker C:I can see that there is a pathway to be able to do more with my business and recalibrate.
Speaker C:There is nothing wrong with that.
Speaker C:And I think actually getting into an arena where we think, you know what, I'm putting my hand up, let's get on with it.
Speaker C:Let's create an impact in my own business that will benefit people around me and then think about whatever happens after that.
Speaker C:One thing I'd just like to go back to, actually, you're talking about the management reports.
Speaker C:I've never heard it phrased in the.
Speaker C:I can't.
Speaker C:I'll paraphrase badly now, but you know, management report reports like, are for accountants.
Speaker C:And I think one of the undeniable truths that again, never really gets aired, client doesn't care.
Speaker C:Client doesn't care about a balance sheet.
Speaker C:Could not care less.
Speaker C:Forget I don't understand it, don't even want to know about it.
Speaker C:And I think that this is.
Speaker C:It was one of the realizations that I had when I started my business.
Speaker C:Like, well, surely every business owner wants to make more profit.
Speaker C:Actually, they don't care about that either.
Speaker C:They care about whether or not they can pay themselves on a Friday afternoon and just how much will that be?
Speaker C:And actually, that is a foundational idea for me.
Speaker C:I. I have some clients that I do some management reporting for, but I dovetail it into profit first.
Speaker C:The analysis that I do within management accounts, I rarely actually go through with a client.
Speaker C:It's for my benefit to know how to tailor the conversation to a greater depth.
Speaker C:The client doesn't have to know about any of the background that goes with that.
Speaker C:Provided their bookkeeping is decent enough, we can draw some sensible conclusions.
Speaker C:But it always comes back to mapping it to profit first.
Speaker C:Talking about things in their language.
Speaker C:We always talk about what's happening with their cash, never about what's happening with their balance sheet.
Speaker C:Yes, clearly I'm keeping an eye on that.
Speaker C:Their accountant will be keeping an eye on that.
Speaker C:Given that I'm a coach only, I don't have a practice behind me to think about those things.
Speaker C:But that kind of skill, it's like, it's not that management accounts don't have value, but the clients don't care about it.
Speaker C:And that again, it's an uncomfortable truth in the accounting world that we feel like we have to explain a balance sheet to a client because that's how I get to increase my charge from 200 a pound to 200 pounds a month to 250 pounds a month.
Speaker C:Okay, well how about we provide real value and turn the 200 into 500 because the client doesn't care about the balance sheet anyway.
Speaker C:Let's give them some information they can actually use in their business to make decisions in real time and actually start growing a business.
Speaker C:So, sorry, I just wanted to come back on that because that's again, I think it's, you know, these are uncomfortable truths and realizations that I've come to as well.
Speaker C:I was always trying to get people to say, yeah, do the management accounts for me, tell me what's going on.
Speaker C:And then getting to the point of going, actually, they don't really care about that.
Speaker C:So you know, how we evolve and move for us as businesses within the profit first community brings these things to the fore as well.
Speaker C:No bad thing.
Speaker B:Yeah, I agree.
Speaker B:I don't, you know, don't get me wrong, I used to love producing management accounts when I worked in business before I set up my own business.
Speaker B:But if you're a financial controller in a business that's producing something, management accounts are really important.
Speaker B:And that's, for me, that's where they are.
Speaker B:That's where they're, they're, you know, at their best for an accountant, delivering it to, you know, a business owner who runs, I don't know, let's say a heating engineer, a plumber.
Speaker B:And that's not dismissing, by the way.
Speaker B:I couldn't go to a house and solve a problem or to a commercial property and solve a plumbing problem or an electrician's problem or, you know, you know what I'm trying to say?
Speaker B:Their specialty is to do that.
Speaker B:Our specialty is to deliver them the information that they can actually understand, take away and make clear business decisions to make the best of their business and to be able to reward themselves in the best possible way.
Speaker B:And also people talk about paying themselves more and, and they feel a little bit uncomfortable about that sometimes.
Speaker B:But actually if you don't pay yourself the money that you deserved from your business, you're not going to be able to create a long term sustainable business for yourself.
Speaker B:And therefore you can't look after the team.
Speaker B:So you're only looking after the team in the short term if you're not paying yourself enough and you're paying them because you won't be able to sustain that.
Speaker B:So, and then you'll end up having to tell them you've got to close the business.
Speaker B:So why not set the structure up with intent from the beginning, pay yourself Properly reward yourself from the business, consider your margins so that you can then track what your team deliver and then you can look after them longer term and create that long term sustainable business that I'm sure most people from the, from the survey I did recently, most accountants and bookkeepers, I think it was, was it 63% seems to ring a bell.
Speaker B:Wanted to create a long term sustainable business, you know, which, which was quite a substantial amount of people and I think 25 also wanted consistently increasing profits.
Speaker B:Well if you don't get that with Profit first, you'll never get it because Profit first delivers that without a shadow of a doubt.
Speaker B:The, the, the what?
Speaker B:The last thing I'm going to talk about on profit for professionals, not the profitless pathway, is when people join Profit First Professionals.
Speaker B:Do you know what?
Speaker B:We don't tie them into a, into a time contract.
Speaker B:We don't tie them into anything because we're that confident that if people follow the framework and follow and take action on what we encourage them to do, they'll be successful.
Speaker B:And we have the evidence of that with all the members that have done great and they're still doing great things with their clients.
Speaker B:Just want to share.
Speaker B:I know time's going on now so we will be drawn to a close soon but I just want to share one thing.
Speaker B:I had a conversation with a Profit first professional, long standing prophet, First Professional member and it just a few days ago and he was saying how he, you know, thanks, thanks to Profit first he's, he's increased his sales revenue quite a lot.
Speaker B:But this is, this is the point he got to, I think he said something like 65k months.
Speaker B:So, so we're talking sizable business now that he's built up a, over a number of years from being a proper first professional.
Speaker B:So he's got, he got up to 65k months and then a couple of things happen.
Speaker B:I think a couple of clients left, it knocked him a little bit and then in the cold light of day he looked at the numbers and he actually realized that when he was at 50k monthly revenue he was a lot more profitable.
Speaker B:And then we looked a bit deeper into the numbers and then we discovered that he'd actually, at that level he'd actually peaked at what I would call his sweet spot.
Speaker B:So we're talking profitability, rewarding yourself in the business, etc, you know, how everything was working.
Speaker B:And as he went higher again he lost his sweet spot, if that makes sense.
Speaker B:So in a way it was really good because we were able to say okay, so let's strip it back.
Speaker B:If you, if you drop back down to 50 and that's your sweet spot, how can you now grow by adding clients whilst keeping that sweet spot in place?
Speaker B:So let's look at you, you need to look at the percentages, the margins, etc, keep those.
Speaker B:If you keep them the same or if you improve on them, fantastic.
Speaker B:But if you kept them the same, all your fixed costs will remain as they are, your variables and your revenue will go up, your sweet spot will continue.
Speaker B:And I think it's apt to share that because it's not just the small trying to get to 100k cannot bookkeepers, there's also a lot of books bookkeepers out there with 500 plus K annual revenue that aren't paying themselves enough money.
Speaker B:And we need, we can, well, we don't need to, but we are able to help them find their sweet spot if they choose to, to seek out that help.
Speaker B:So I wanted to share that because it was fresh in my mind from a few days ago.
Speaker B:But I think, yeah, is there, is there anything else Deb?
Speaker B:Is there anything you want to add about, you know, what would you say to anyone that perhaps is thinking, shall I join the profit first pathway and see what this profit first business is all about?
Speaker A:I think it's a no brainer, isn't it?
Speaker A:I mean if you don't get anything out of it, what have you lost?
Speaker A:An hour on a Friday morning.
Speaker A:But you may well be surprised, it may well be exactly the help that you're looking for and you didn't know was out there.
Speaker A:Like minded, freely giving of their time and expertise and struggles and challenges that they've overcome or facing.
Speaker A:And it's a great community.
Speaker A:It's definitely collaboration over competition.
Speaker A:We don't look to, to steal anybody's ideas or anything.
Speaker A:We take inspiration from each other.
Speaker A:But it's, it's a real nice group of accountants, bookkeepers that want to help their own business.
Speaker A:But because it's only from when you're in a safe space and you've got a stable business that you can then help your clients and go back to that cliche of in a plane and you're in an emergency, they tell you to put your own oxygen mask on first, don't they, before helping anybody else.
Speaker A:Well, if you do that and you learn that, how to do that and you have got a, a well run, profitable business with a framework that you're working to, then you've done it and you're, you're, you're, you're Helping your clients from a place of experience.
Speaker A:So yeah, come join us, see what it's all about.
Speaker A:We're not a cult.
Speaker A:We don't sort of like make you force you to sign up for the following week or anything like that.
Speaker A:Yeah, I thoroughly enjoy the, the, the sessions that we have.
Speaker A:Look forward to them every time.
Speaker A:That's it.
Speaker B:Thanks.
Speaker B:Thanks.
Speaker B:Appreciate that.
Speaker B:Jason, you've got anything you want to add to close off with?
Speaker B:Yeah.
Speaker C:I think that one of the major benefits of us doing the work we are on, the challenge in, in the proffers pathway is we have the classic ABC setup as we would think about it and Profit First.
Speaker C:We have an accountant, Strokex accountant in Tim, we've got a bookkeeper in Deb and we've got coaching me.
Speaker C:We are covering off those three elements and we are dovetailing our experience into those conversations every single week.
Speaker C:So whether you are an accountant, whether you are a bookkeeper, not probably coaches will be at the smaller end of the scale, but our ability to think about how we move from just a compliance practice to actually having a practice that pays us to thinking about how we.
Speaker C:I'm going to say we truly embed the idea that advisory work is possible and there are skills readily available to teach some of those techniques to take us out of compliance world.
Speaker C:And talking about balance sheets, yeah, useful information for us but we have the power and the expertise to take you into that advisory space.
Speaker C:And I think that ultimately the collection of our experience coming at it from different angles.
Speaker C:Tim's business would have been structured in a certain way.
Speaker C:Deb has a very specific model that she's used in her business historically and worked that incredibly well through experience and ultimately the things I see from a range of businesses in my own client base as well as working with the accountants and bookkeepers through the certification process.
Speaker C:With Profit first there is an immense amount of knowledge available on a Friday morning.
Speaker C:And I think that classic idea, can you take one thing away from each session and most importantly implement it, do something about it, take action on it.
Speaker C:Five weeks of taking action, accumulation of effort, untold benefit.
Speaker B:Absolutely.
Speaker B:And so you can join us on the Profit first pathway through Facebook.
Speaker B:So if you go onto Facebook and search the Profit first pathway, you'll see a graphic with our three faces on cheerily there with, with Profit first as well with the book.
Speaker B:And it'll be a nice green and blue color so you can see our branding for, for the Profit first pathway.
Speaker B:So yeah, just, just click, just click to join.
Speaker B:Answer three simple questions.
Speaker B:You know they're really easy, you know, are you an accountable bookkeeper or coach?
Speaker B:It's not exactly difficult taxing questions.
Speaker B:So just answer, answer the questions, greet the rules and you're in.
Speaker B:And we look forward to seeing you on, on some of our future calls.
Speaker B:So thank you very much for joining me, Jason and Deb.
Speaker B:It's a pleasure running the Profit first pathway with you both.
Speaker B:The the natural, I think there's a natural chemistry the way that we like working together, but also I think the enthusiasm in how both of you want to help accountants, bookkeepers and coaches with Profit first comes across really well.
Speaker B:So, so thank you very much being part of it with me.
Speaker B:And yeah, anyone listening, we look forward to you joining us in the Profit first pathway and we'll see you very soon on the podcast soon.
Speaker C:Thanks.
Speaker C:Thanks, Tim.
Speaker A:See you soon.
Speaker B:Thank you for joining us on our podcast today.
Speaker B:Profit first beyond the Book was brought to you by the Profit First Professionals UK and Ireland team.
Speaker B:If you'd like to find out more about Profit first or becoming a Profit first professional, head to our website, profit first uk.co.uk.
