Dave WordenTriumph Business Solutions · Founder

What are 'TAPS' in Profit First? Episode #3 'Under The Covers'

22 Oct 2019 · 0 min

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TAPS stands for Target Allocation Percentages, the ratios financially elite companies use to allocate money across their business. They're goals to work toward over time, not starting points. Begin with your current allocation and gradually shift toward the TAPS.

Questions this video answers

TAPS stands for Target Allocation Percentages, which are the allocation ratios used by fiscally elite companies across all industries. They are aspirational targets you can set for your business, but you should start from where you are today and gradually work toward those percentages over time.

Yes, TAPS function as goal benchmarks for your business's profit allocations.

So under the COVID can you tell me about taps? What does it mean? How do I use it?
So there's tapping where you can tap your body. There are people actually do this. It's not that. Taps in profit first terms is an acronym for Target Allocation Percentages. These are percentages that I did some research as I was writing the book to determine what the fiscally elite companies do, the healthiest of all companies in all industries. So it's not industry specific, it's in any industry. And reveal these in the book. And as a implementer of Profit first, and I hope you do it, these are simply targets you can set for your business to achieve one day. The mistake that people make is they say, I need to start at the taps. Do not do that. These are what the fiscally elite do. We're going to start wherever you are today. So maybe you've never had profit before. We'll start low and then we'll grow it slow toward ultimately hitting those taps, maybe in a year or two from now. But that's what we're targeting, not where we're starting.
Perfect. So it's like a goal.
Yep. All right, back under the covers.