Christie JungeA Plus Solutions Inc. · CEO | Profit First Professional

Profit First Myths Debunked| Profit First Is A Set and Forget System

4 May 2021 · 1 min

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1:01

In this brief video, Mike Michalowicz, author of the Profit First methodology, addresses a common misconception that Profit First is a "set it and forget it" approach. He emphasizes that the system is dynamic and requires regular attention. Specifically, he advises business owners to review and adjust their Current Allocation Percentages (CAPS) each quarter, tweaking allocations for profit, taxes, owner’s compensation, operating expenses, and any advanced accounts such as CapEx, future employee, retainers, and drips. Michalowicz recommends partnering with a Profit First professional to conduct these quarterly reviews, ensuring the system continuously evolves to improve the organization’s health and serve its shareholders.

Chapters

Hi there, I'm Mike Michalowicz, the author of Profit First. I'm doing a series of videos to bust Profit First myths. One that circulates around is that Profit First is a set it and forget it system. It's not. Profit First is a dynamic system. We have over 500,000 businesses that have implemented Profit First. It's very clear that you should revisit your Profit First CAPS settings on a quarterly basis. CAPS stands for Current Allocation Percentages. And you wanna adjust your profit, your tax, owner's comp, and OpEx, but also there's advanced accounts. Perhaps you have a CapEx account, future employee account, retainers, and drips. All these accounts should be readdressed to maximize the health of the organization and to serve the shareholder of the business. I strongly suggest you work with a Profit First professional. Once a quarter, have that sit-down meeting, figure out how the business can be further enhanced and tweaked, and make sure that Profit First is perpetually improving into perpetuity.