“John, what percentage do I allocate for________?” This is often a question I receive from my clients. So today, I thought we would talk about it, directly.
In a lot of our Profit First tip videos, we talk about allocating income and putting it into different accounts, so it is no surprise that a question we get a lot is “What percentage of the income do I put into each account?”
We like going off of percentages because percentages will fluctuate with the income level. The downside to doing a fixed amount instead of a percentage is that since income fluctuates you don’t know the exact number you will have at any given time to be able to put into the account.
How do you figure out those percentages? You do an assessment! In our book, Profit First for Micro Gyms we offer a sijmple assessment, and even walk you through it step by step. What that assessment will tell you is how your gym compares to a financially fit gym that we have researched, in order to determine what percentage should go into each account.
By looking at the successful gyms and seeing where their costs are and what percentages they are putting into each account we can better determine where you currently fall in line and your percentage should be. We strongly recommend checking out our book, but we do also have resources online that can help you with the assessment to move you forward!
Watch My Newest Tip Video Below To Learn More About This Process!
Check out our other videos for information on the Profit First system and other great tax tips for microgym owner.
You can order a copy here of my new book Profit First For Microgyms and begin establishing your HEALTHY cash flow system, TODAY!
Interested in more tips and advice on how to better manage the financial health of your microgym?
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