Would you like to understand your business more clearly? Where your money comes from, where it's going, and how you can improve on both? This series is for you!
Everybody loves to make a profit!
When there is a surplus of money in your pocket and payroll is being made without issues it’s pretty easy to say that you are being successful in your business, right?
Nobody enjoys having to pay expenses; they strip profit from our bottom line, sometimes altogether. And yet sometimes we don’t give our expenses the attention they deserve; we don’t always analyze our expenses, to break down the fluff to see where we can be more effective.
Break down your profits & expenses
This article is the first in a series about how to break down our profits, and our expenses into concrete numbers, so that we can create a baseline, and an average. Once you know what your average profit per tow actually is, you will be able to answer some critically important questions:
- Is it time to raise my prices?
- Which of the segments of the industry, (Private Property Impound, Cash Calls, Motor Clubs, Municipal Towing, Police Calls, Repossession, Auction Towing) is causing my business to profit the most?
- How can I get more of the business that I am benefitting the most from?
Understanding your expenses more concisely isn’t a fun process, but once you understand your profits, and then your expenses down to the cost per mile of each of your trucks you are able to accurately answer these questions:
- Which of my contracts are hurting my company?
- Which items in these contracts need to change?
- Am I allocating enough funds towards my maintenance budget every year?
- Which of my trucks are costing me the most to operate?
- Which of my trucks are the most profitable to operate?
- What kind of trucks should I be purchasing more of and which ones should I consider letting go?
If this sounds like information that will be valuable and useful for you, stay tuned, or register for our newsletters at the bottom of the page for the next article in my Profits and Expenses Series