Profit and Loss Statement for Moving Companies

Hey, my friend. It's Luis Massaro, CEO, Moving Mastery, and founder of Moving Sales Academy. Do you ever feel like you're just not on top of your business? Like there's certain areas that you just can't see, you know, you know, there might be an issue or there might be a problem, might be some additional opportunities, but you just. You don't feel that you can see it all in front of you. I want to share with you a process that, for me, really was one of the defining moments in what helped me take my business to the next level and just have that total clarity of what was going on and be able to make the decisions that I needed to make to grow my business, to make adjustments and to make improvements. And that was reviewing my profit and loss statement every single month. All right, if this isn't something that you do now, you need to watch this, because this is very, very important. And I know a lot of people kind of shy away from it, right? They'll, you know, I'll talk to them about it and, you know, follow up with them in a few months. And they don't. They haven't started this process yet. And, you know, a lot of times it's being scared of what you're going to see, right? When you start to unravel your numbers and start to take a look at what's factual, what's actually there, how your company's really doing. You know, some people, they want to know, but they don't want to know, right? You need to know this information. It's the only way that you're going to grow your business. It's the only way that you're going to scale your business. It's the only way you're going to keep yourself from hitting an iceberg and crashing your ship. All right? You need to make sure that you're on top of these numbers every single month. So I talked about this broadly in the video on knowing your numbers, all right, which is number one. It's the number one rule in the 10 rules of a profitable moving company. But I talked about it broadly, so I want to, you know, specifically talk to you about how to go about reviewing your P and L, your profit and loss statement every single month. All right? So first of all, I would recommend if you don't have an accounting software that you sign up for QuickBooks Online, it's super easy to use. It's only, I think, depending on the package, you get maybe like 15 to $30 a month, depending on what level. But. But it'll allow you to integrate your bank accounts, your credit cards, everything in there. And it'll just be very seamless. So if you have a bookkeeper, it'll be very easy for them to use. And if you don't, you'll be able to figure it out as well. All right? So the first thing you want to do is make sure that all your income and expenses are recorded, all right? So what that means is making sure that everything is recorded into QuickBooks. Now, if you use a different accounting software, that's fine. It just matters that you use an accounting software, all right? Don't try to do all this with pen and paper. And I don't care what level you're at. I don't care if you just started out. You need to spend this money and get QuickBooks or some other accounting software for 15 bucks a month, super cheap, all right? So record all of your income, all of your expenses, and you want to make sure that it's all categorized exactly. You know, so your income, you want to have local moving income, you want to have long distance moving income, you want to have storage income, all right? You really want to break it down. You could even go further and break it down as packing income as well. Then for your expenses, you want to have operational expenses, right? You want to have labor expenses, you want to have everything broken down and really, you know, drilled down so you know what's what. All right? So you need to get it inputted into your accounting software. That's the first step. Now, once it's being done. So ideally you would have a bookkeeper, right? And this would be happening on a regular basis. The bank accounts would be integrated with QuickBooks, your credit cards would be integrated with QuickBooks. Everything would go in there. When you make a deposit, it'd be put in QuickBooks. When you ran credit cards, that would be integrated and that information would go into QuickBooks, right? And you would have a bookkeeper that's going in and basically categorizing all of that to put it in the right spot. Okay? So the thing that you're going to want to do first and foremost once that's being done, is review a detail detailed P L, a detailed profit and loss statement. So every single accounting software should allow you to print out either a summary or a detailed P L. All right? So you can either print it out, you can do it in Excel. I'm a big fan of doing things in Excel, but when it came to this, I would always print this out, hold it in my hand, get out A pen. And what you want to do with the detailed P and L is you want to make sure that everything that was classified, everything that all the expenses were put in the right category. Okay. So for example, if you, you know your fuel expense, you want to make sure that that's listed under fuel for your trucks, you know, maybe you pay your own personal fuel for your car out of the company, you want to make sure that's in a different category. So you want to make sure that whoever is categorizing this information, your bookkeeper, you know, they could very easily make some mistakes as to exactly where things should be categorized. So you go through this, you make the adjustments, write them out, either make, go back into QuickBooks and make the adjustments yourself, or hand this back to your bookkeeper. I would hand it back to the bookkeeper and they would make the adjustments, make the corrections, and then I would be able to review a summary P and L and I would add the percentage of income filter to it. So what this is now you won't have on the detailed P and L, you have every single transaction for the month. It's going to show every single deposit, whether it be cash, whether it be credit cards, every single check that was paid out, every single credit card statement. But on your summary, it's just going to show income, local moves, how much income, long distance moves, how much income, storage, how much total of all income. Right. Then it's going to list all of your expenses. So what you want to do is print out the summary and add on percentage of income. So the percentage of income, what that's going to do is tell you each one of your expenses, what percentage of your total income was spent on that. Right. So for example, if you had your marketing and under marketing, it said that you spent, let's just say $10,000, your total income, let's say, was $100,000. So next to marketing, where it says you spent $10,000, it would say 10% of income. Right. So that's a real good indicator and a number that I like to look at to be able to doing. Right. That percentage jumps out off the page and really will speak to you a lot of times more than just the numbers themselves. Right. So it's a great identifier to be able to tell how you're doing and if you're keeping things in a certain range. Right. For example, your labor percentage, Your labor percentage should pretty much be the same all the time. All right. It could fluctuate very little, but it should be the same. So I can tell you by reviewing my P Ls and one of my offices, I found that my labor percentage was high. Well, when I started to look into that, I found that the dispatcher had a little deal going on with the movers, was paying them extra hours and getting a little kickback after they cashed their check. So I found out about this. Why? Because I was reviewing my P and L. All right? I've also found out about claim situations. This is how you find out what's going on in your company. Because when things aren't right, you could see it in the numbers. The numbers don't lie, all right? Very important. So again, I would print that out, mark it up, write all over it, all right? Circle things, highlight things, write all over whatever you see that's not right. Or you have a question on. Right. Why did we spend so much buying moving equipment this month? Right. Circle it, write your question next to it, and then you could go research it later. Right? This is so important. Take the time to review the numbers to go through them. It may be intimidating at first if you've never done it, but I can tell you once you get in this process, you're going to have total control over your company. You're going to know exactly what's going on, and if there's problems, they're going to be sticking out to you and you're going to be able to resolve them. All right? And the last thing you do is identify areas of concern and areas of opportunity, all right? Every single month you can go through it and say what? You know, why area of a concern? Right? Like why did we spend so much money in moving equipment? Right? You need to look into that. You know, maybe you're losing moving equipment and you don't know about it, right? Especially if you're not hands on every single day with your business and you're kind of remote and you have people running things. Your P and L is what's going to really help you the determine what's going on. And then there's opportunities, right? So you could also see that you're doing really well in a certain area and maybe you could ramp up your efforts there. Maybe you see that you're only spending 3% of your total income on marketing. Well, you have a lot more room that you can go. You have a lot more money that you could spend in marketing, right? That's an area of opportunity. So by going through this every single month, I'm telling you, it'll change your life, it'll change your Business, you'll be on top of things and this is how you need to run your business. Once I started doing this, once I started understanding this, this is where I found out everything that was going wrong. This is where I found out all the adjustments I needed to make. This is where I was able to open additional locations, scale those locations. Right? Know when we needed to pull back on certain expenses, know when we could really push forward with certain things. If you're not doing this now, and listen, I know people at multiple locations. I know people that are van line agents that don't do this. So this, I'm not talking to someone who is just starting a moving company. This goes for everybody. And you could be very, very, very successful. You could be making a lot of money and still not do this. Alright? So you may be watching this. I'm good. I'm making a lot of money. But you know what? You could be making more money if you do this. Because it's not always what's coming in, it's also what's going out. And if you don't visually see what's coming in and what's going out every month, there's a lot that could be happening that you don't know about. All right? So please, I challenge you, start reviewing your P and L every single month. Regardless. If you're just starting your business today, do this every month. If you've been in business 20 years and you're doing 5, 10 million a year, do this every single month. All right? You'll thank me for it. I'm telling you, this is some of the best advice I could give you. This is one of the things that really helped propel me to that next level in my business. Alright? If you have any questions, as always, leave them down below until I see you next week. Go out there every single day. Profit in your business, thrive in your life. I'll see you later. Hey, my friend, It's Louis. I hope you enjoyed this episode. Do me two favors. Number one, subscribe to this channel so that you continue to get updates every time I release new training for you. And number two, if you'd like to get ahead a little bit faster and become more profitable in your business, what I'd like to do is give you a copy of my 10 rules of a Profitable moving company. These are the same 10 rules that I applied in my business that helped me grow into a multimillion dollar nationwide company. Okay? So all you need to do is click on the link on this page or head over to LewisMassaro.com tenrules so that's Lewis L O U I S Massaro M A s s a r-o.com 10rules. Just put in your name and email address and I'll email you out a copy. Okay? Until then, every single day, go out and profit in business and thrive in life. I'll see you later.