Get Out of the Survival Trap - For Good
Mike Michalowicz
As a keynote speaker and business author of multiple books including Profit First, I share my journey so yours is one of profitability.
How many decisions did you make for your business last year? Decisions to solve a problem, fix a mistake, decide whether or not to take advantage of an opportunity, add a new product or service to your offerings, or try a new marketing strategy. No doubt you made a lot of decisions last year and put out a lot of fires. Phew.
Now, let me ask you this: Did any of those decisions move your business forward in a big way? Did your company see record growth? Were you able to step back from the grind of doing all the things and let your team run things? Did you make a significant impact in your clients’ lives? In your community? In your industry? If you answered yes, I’m stoked for you. If you answered no, welcome to the common experience of business ownership. Or what’s better known as the Survival Trap.
So, what exactly is this trap that so many of us find ourselves in? Well, picture this: you’re running your business day in and day out, but no matter how hard you work, it feels like you’re barely treading water. You’re just scraping by, living paycheck to paycheck, with little to show for it in terms of profit or financial stability. That, my friends, is the Survival Trap in action.
Let me break it down for you. The Survival Trap is a vicious cycle where businesses struggle to make ends meet, constantly playing catch-up with bills and expenses. It’s like running on a hamster wheel, working tirelessly just to stay in the same place. And trust me, I’ve been there myself.
What makes the Survival Trap so insidious is that it’s not just about the numbers on your balance sheet. It takes a toll on your mental and emotional well-being too. The stress, the worry, the constant uncertainty – it can all lead to burnout faster than you can say “profit margins.”
The Survival Trap is deceptive because it fools us into thinking we are at least inching toward our vision, as if our reactionary behavior is actually “smart” or evidence of our good instincts, and will eventually lead us to the promised land: financial freedom. When it comes to our business’s (lack of) cash flow, we often throw our few remaining dollars at the immediate problems and opportunities, hoping that profit will magically materialize.?
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When it comes to our time, we burn out ourselves and our people by working even longer hours, constantly putting out fires, and chasing arbitrary quarterly targets instead of building sustainable systems. And when it comes to fixing the business, we find ourselves patching up the obvious problems, only to wonder why they keep reoccurring over and over again.
The way out is through implementing the Profit First system. It offers a transformative solution to the Survival Trap by prioritizing profit through the allocation of revenue into separate accounts dedicated to profit, owner’s compensation, taxes, and operating expenses. Then, your profit will be a priority, not an afterthought.
This approach to financial management ensures that you won’t have to constantly chase money down and breaks the cycle of seeking cash to cover expenses. You’ll create a sustainable financial foundation that fuels growth and resilience for the long game.
Wishing you tremendous success!
-Mike
Co-Founder & Creative Director | Premium Brand & Print Design at Revel Up Media
11 个月This is currently where I am stuck, but giving it one last great shot to push through and out of this by mostly learning and education. Can't wait to follow along the rest of your posts...
Ghostwriter, TED Global Speaker
1 年I think you ought to write a book called "The Survival Trap" and incorporate ALL the best information from your other books! Some of us are so low on the financial tier that we're struggling to pay rent (I am). I haven't (admittedly) read Profit First, but I'll check it out.
Investor ??????Business Coach?????? Stop working IN your business, work ON it instead! I also love buying and selling businesses and real estate, and Consult in all these. Hardcore Networker and Connector!
1 年Staying in the survival trap can actually lead to the demise of a business, overtime. As you mentioned here, just hanging on for dear life, being unable to get ahead or really to wrap our mind around what’s happening, and why we’re just treading water and holding on by the skin of our teeth, while we’re putting out so much energy, hours, dumping money into various advertising, business expenses, and all the rest of it. When we are stuck in the business at that level, it’s almost impossible to step back and look at or work “on “the business as a business owner. But that’s the most important thing we need to do! I’ve seen and worked with so many businesses that get to this point, usually around one or 1.5 million in revenue for trades businesses. And then they’ve been burning the candle at both ends for so many years, running all of the different jobs and departments in the business, wearing all the hats, plus their entire personal and family, life, and anything else that might be going on for a human being Just piling in over and over and over, every day in this quicksand. But as crazy as it is, some people who get to this point, and get thrown a rope to save them in their business, won’t take it when it means they have to change..
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1 年Interesting concept of the "Survival Trap." Mike Michalowicz
The "Survival Trap" was my reality early in my entrepreneurial journey - constantly on the hamster wheel, working tirelessly with little to show for it. Something changed after I read your book "Profit First". It offered not just hope but a new way of thinking. By rethinking the way I managed finances. "Profit First" is a must-read for all entrepreneurs.