Jasz
VIP Contributor
Measuring Profit in Your Business
Profit is a word that gets thrown around a lot in discussions about business, but it's not always clear what people mean when they use the term.
The way you define profit depends on what you're trying to accomplish. Some small business owners focus on short term goals, while others are thinking more long term. And some business owners aren't thinking about profit at all—they're focused on cash flow, which is different from profit.
Profit is the money your company has left after paying all of its expenses. In other words, it's the income your company keeps after paying out all of its bills and expenses. Cash flow measures how much money is coming into and going out of your company over a given period of time.
If you're trying to grow your business, then you'll want to measure profit and focus on growing your profits over time. But if you're just looking for ways to spend less or bring in more money in the short term, then you might be more interested in cash flow statements. Are you actually measuring profit in the right way in your business?
Profit is a word that gets thrown around a lot in discussions about business, but it's not always clear what people mean when they use the term.
The way you define profit depends on what you're trying to accomplish. Some small business owners focus on short term goals, while others are thinking more long term. And some business owners aren't thinking about profit at all—they're focused on cash flow, which is different from profit.
Profit is the money your company has left after paying all of its expenses. In other words, it's the income your company keeps after paying out all of its bills and expenses. Cash flow measures how much money is coming into and going out of your company over a given period of time.
If you're trying to grow your business, then you'll want to measure profit and focus on growing your profits over time. But if you're just looking for ways to spend less or bring in more money in the short term, then you might be more interested in cash flow statements. Are you actually measuring profit in the right way in your business?
