Mike Michalowicz shares his secret to being profitable from day one
Hosted by Sarah Shaw, founder of Sarah Shaw Consulting. This show highlights strategies and stories that support product-based founders through wholesale strategy, boutique outreach, media pitching, and celebrity gifting.
Mike shares simple systems that support profit. Product founders need strong pricing and planning. Use this costing guide to tighten your numbers.
Want to be profitable from your first day as an entrepreneur?
Who doesn’t?
Mike says that most companies operate on the “make money take money” theory. You make money that day and it’s in your bank account, then it’s there to spend.
But, and it’s a huge but, did you know that 83% of small businesses (making less than 26 million per year) are surviving check to check?
Most everyone is treading water daily.
Mike shares how the old way of figuring out your profits is dead…..
The old way is: Sales – Expenses = Profit
It’s a kick the can down the road way to build a company.
What Mike discovered with the “Profit First Formula” is simple when you break it down……just flip the formula.
Now the new way to be profitable is: Sales – Profit = Expenses
This forces you to address your behavior around money.
Hang out with me and Mike and learn how to take your profit first and figure out how to run your business mean and lean with the allotted operating expenses.
Entrepreneurs tend to pay themselves last…….but not any more thanks to Profit First. Mike and I agreed that we’d never underpay our best employee right? Well no one is more dedicated and better deserving than the boss! Which BTW is YOU!
So pay yourself first and you’ll love coming to work even more.
The theory behind Profit first is that you put all the money into one “Income” account and every 2 weeks, before you spend anything, move the money into the specific accounts below in order to be profitable and limit your expenses to what you can actually really afford.
Example of setting up multiple accounts
Income Account (all deposits): then use to this money and divide it up into the accounts below.
Profit account: This is bonus pay – add 10% of income account here and every 90 days allocate 50% to the boss (you) and any other owners.
Owners pay acount: This is for owner/operator salary – you are an amazing employee – you get 25% – pay out to yourself every 2 weeks.
Tax account: Put money here for taxes so you don’t get caught with your pants down – put in 15%.
Operating expense account: Depending on your business you may need up to 50% of your income here – pay employees, overhead etc..
If you really do this……. you’ll quickly see it forces us to be more creative
More about Mike…..
By his 35th birthday MIKE MICHALOWICZ (pronounced mi-‘kal-o-wits) had founded and sold two multi-million dollar companies. Confident that he had the formula to success, he became an angel investor… and proceeded to lose his entire fortune.
Then he started all over again, driven to find better ways to grow healthy, strong companies. Among other innovative strategies, Mike created the “Profit First Formula”, a way for businesses to ensure profitability from their very next deposit forward.
Mike is now running his third million dollar venture, is a former small business columnist for The Wall Street Journal; is the former MSNBC business make-over expert; is a popular keynote speaker on innovative entrepreneurial topics and superstar places like Harvard, Ebay and Princeton; and is the author of 4 books……..Surge, Profit First, The Pumpkin Plan and The Toilet Paper Entrepreneur, which BusinessWeek deemed “the entrepreneur’s cult classic.”
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I’ve worked with Sarah for about 3 months now and my line has been picked up in 2 new stores with a re-order 2 weeks later! She is very knowledgeable about sales/ marketing and knows how to get everything done! She truly felt like a partner for my business, and I look forward to working with her in the future.

Everything’s coming together. I am so excited. Thank youthe website looks great. I am so proud of it now it looks so professional. I was thinking about giving up because I felt so buried and had no direction. I am happy I hired you to help me.
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“In just one hour on the phone, Sarah gave me clarity in my pricing and bottom line… Our new product went off without a hitch. Thank you, Sarah!”

I wanted to share the importance of persistence, as you always say! I pitched another item to this writer Aug 1 and explained the benefits of alpaca fleece and a month later she reached out asking for a sample of the pants she ended up highlighting and writing about a week later! As always, thanks for the support! Check out Daph’s Post in FORBES!

“I am a detailed person and hate when I buy something online and am not satisfied. It’s always hard to tell when you haven’t been face to face with online sellers on whether to buy or not. I took the whim with my gut and bought. Entreprenette’s celebrity program was just what I needed and was looking for! I know that I only have one first impression with these gatekeepers and Sarah Shaw gave me just the details I needed to know how to contact the celebrities camps to get them interested in my… Read more

I’m already getting orders from the email with the updated pricing that I just sent to my current stores. One day I’m gonna fly wherever you are and buy you a big glass of wine and hug you. Truly blessed that I stumbled upon your site that day. I know I pay you to help me but you’ve done so much for me and are worth every penny if not more.

I’ve been working with Sarah Shaw Consulting for just one month, and the results have already exceeded my expectations. Her program has given me the tools, confidence, and strategy I needed to start growing my supplement brand. In fact, within the first month I was able to secure placement for my supplement line inside a gym. The step-by-step guidance and real-world expertise Sarah provides make her program truly invaluable. I’m excited to see how much more progress I’ll make as I continue… Read more

Sarah has always been so knowledgeable and has helped me so much in growing my business and getting my Daybooks out into the world. She most recently helped me prepare for the NY Now Gift Show which turned out to be a great opportunity to gain more exposure and make connections that I know will help me take my business to the next level. She is the real deal. She knows her stuff and is so dedicated to supporting women in business.

I wanted to tell you that my AOV is up 46% over the month before I joined with you, just simply from increasing and restructuring my mark-ups for ws and retail! AND my gross margin is up by about 10 percentage points too!…in just one month from making these changes. That in itself will pay for your program in a couple of months at this rate!! It really makes working “worth” it again! https://idlewildeveryday.com/
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the website looks great. I am so proud of it now it looks so professional. I was thinking about giving up because I felt so buried and had no direction. I am happy I hired you to help me.