Making sure you are running a business

[Clutchy]

5 minutes ago, josharb87 said:

That’s kinda my point, what’s the point in paying yourself a mediocre wage but the business has lots of profit? Isn’t it better to pay your self more, or improve the business and have a smaller profit?

 

I don’t really see why it’s beneficial to have loads of profit which could have been used for investment’s or higher wage 

Definitely, if you're a climber and owner, you should be on a good climbing wage plus a good wage for running the company. 

 

It is really important to make a good amount of profit but equally important to put it to work. No point having loads sitting in your ltd company bank account when you never know when you could get sued and lose it all (unlikely I know). So a good take home pay + as many benefits as you can eek out of it (legally...) and looking into other business ventures, property etc. 

[Puffingbilly413]

44 minutes ago, josharb87 said:

That’s kinda my point, what’s the point in paying yourself a mediocre wage but the business has lots of profit? Isn’t it better to pay your self more, or improve the business and have a smaller profit?

 

I don’t really see why it’s beneficial to have loads of profit which could have been used for investment’s or higher wage 

I think the original point was that high turnover is a poor measure of success on its own.  Profit - or being a profitable company is probably a better way of putting it - is what gives you the ability to pay yourself or your staff more and invest etc. As opposed to having a high turnover that simply doesn't outmatch your running costs.

 

Granted, if you're an owner-operator then you're going to have a slightly different perspective depending on whether your looking at the situation as the employee or the director.  But then that's your prerogative to choose to pay yourself more (or less) v having more cash available for your company to use (or not). 

 

What was the name of that big arb company down in England that went under a few months ago with a million plus turnover but a tiny, tiny profit in the few thousands, I forget now?

[Clutchy]

3 minutes ago, Puffingbilly413 said:

What was the name of that big arb company down in England that went under a few months ago with a million plus turnover but a tiny, tiny profit in the few thousands, I forget now?

No idea but I definitely wouldn't want million pound turn over problems and headaches for only a few K in profit as you say

[treevolution]

56 minutes ago, Clutchy said:

Definitely, if you're a climber and owner, you should be on a good climbing wage plus a good wage for running the company. 

 

It is really important to make a good amount of profit but equally important to put it to work. No point having loads sitting in your ltd company bank account when you never know when you could get sued and lose it all (unlikely I know). So a good take home pay + as many benefits as you can eek out of it (legally...) and looking into other business ventures, property etc. 

What do you consider a climber/owner company profits should be on a year. 

 

Have only had a chance to watch half but so far some really good points. 

[AHPP]

It was good, don’t worry.
 
I liked, ‘don’t make the customer’s problems your problems’

A friend recently reminded me of the following, excellent phrase.

“Lack of preparation on your part does not constitute an emergency on mine.”

[Clutchy]

22 hours ago, treevolution said:

What do you consider a climber/owner company profits should be on a year. 

 

Have only had a chance to watch half but so far some really good points. 

Assuming you pay yourself circa 15k a year so you can max profits to be mostly paid in divs 

 

If you're a 3-4 man team I think you want to be in a position to pay yourself £60k+ total comp 

 

So 50-100k profit a year would be something to aim for. 

 

Bare in mind you're unlikely to see this until 3-6 years in at least