John Briggs, author of the book “Profit First for Microgyms”, sat down with the Level Method Legion Mastermind to talk about some core principles related to how the system works and the impact that it has.
What is profit first?
The primary action associated with putting this concept into practice is to create separate bank accounts for the different allocations of the budget.
For gym owners, John suggests a separate account for the following “Essential 7” uses of business funds:
Income - the account that receives all company revenue before it is distributed to the following accounts
Team Members - For coaches on the floor (including you)
Owners pay - Your salary
Profit - Quarterly profit distribution and backup for emergencies
Tax - allocation for year end taxes
Equipment - allocation for equipment that breaks or new needs
Operating Expenses - All other expenses related to operations such as rent, utilities, software, etc.
Sounds outlandish or out of reach?
John explains why that is often the case:
Tight on cash flow?
Here he describes the best way to make the transition to this concept.
What percentages are ideal for you?
How you should get paid.
John shares some insight into some thought processes around your pay you may want to consider and that contradict how many currently think.