I speak with a lot of business owners who tell me they have a booming business. Turnover between $1M to $5M+ per year.
While this looks great on paper, when I ask “What are you putting into your personal bank account?”, there’s often a significant pause.
I’ve had instances where owners have said they haven’t drawn a salary for 2 years!
Years ago a multi-millionaire mentor of mine told me, “The only reason for being in business is to be able to invest in personal assets which you use to create wealth.”
With that in mind, ultimately the only thing you should care about is getting the number in your personal bank account up. That should be your prime reason for being in business and taking the risks you do.
That is how you create wealth for yourself and dare I say it, for the people who support you.
Ah, I hear you saying, “But Rashid, one day I’ll sell the business and cash out”.
The sad reality this almost never eventuates. You end up slogging away for years and at the end effectively have to close up shop.
Now I understand that in the beginning phases of business, it can take a lot of cash to keep going. You invest back into your business. And you may not pay yourself much, if anything.
But you can’t stay there.
You need to move rapidly from instability where you’re vulnerable and very stressed to stability where you breathe knowing you can pay your bills.
Now move into a consolidation phase where you strengthen and fortify your business, paying yourself well for your hard work.
Which gives you a solid base to expand and create an asset where you achieve a level of freedom and autonomy.
So as Stephen Covey eloquently put it, “Start with the end in mind”.
By all means have a long term view that you might be able to sell your business, and if it does that’s a bonus. But in the meantime, ensure it pays you extremely well along the way.
Which means you must implement a comprehensive sales system, something we’ll be covering in future articles as well as upcoming webinars.