I sat down in the banker’s office across from two guys, both wearing a suit and tie. It was a typical bank meeting. I was nervous, and they were in a hurry. I had franchised my brand and, by this time, had opened over a dozen locations around the country. I was a seven-figure business owner with a corner office and a team of twelve.

I pulled out the latest set of financials and slid a copy across the table to each of the bankers. By this time in my retail career, I knew how to read the financials and I understood what the numbers meant for my business.

I had been calling bank meetings for years. Over-communicating is never a bad thing. Every meeting was the same. I would bring the financials, they would glance over them, flip through the pages, eyeball the summed numbers that stood out in bold, ask me a few non-descriptive questions (which I would answer), and then we would all stand, shake hands and they would say “See you next month”. Of course they asked about profitability—what lender wouldn’t? But the majority of the conversation was focused on top line revenue. As long as that top line number was projecting upwards, there would be smiles and nods, we would overlook poor margins and growing expenses, and everyone would feel comfortable with the company happenings.

Sales.

A growing top line number was everyone’s goal. Isn’t it always? You can hear it in the way business is talked about:

“I want to be a seven-figure business owner”.

“I am building a multi-million-dollar brand”.

“We just hit out first six figure month”.

We feel like our top line numbers give us value and make us “legit”. We think those big numbers tell the world that we have arrived as small business owners. It is all about the number at the top.

But is it?

What if it’s the number all the way down at the bottom (the profit!) that actually really matters? Now don’t get me wrong, bankers, friends, family… they all would say they want you to be profitable, but let’s be honest, when is the last time you heard anyone analyze their profitability and compare that with others’ numbers? I am guessing never. You will see top line numbers plastered on social media and you might even overhear business owners trying to top each other with sales figures. However in over two decades in the small business world, having attended dozens of conferences and having found myself more than a few times at a table of business winners, I have yet to hear talk of profitability. Sometimes it’s simply that owners are private and don’t want to share the details of their profit and loss, but more often than not (a lot more often than not) it’s because entrepreneurs are focused on the wrong number. They are focused on the feel good, plump number on the very top of the page, instead of the hard earned, much needed number at the very bottom.

And those top line numbers can feel very good to see! As typical for my many bank meetings, when I shared my financials, the bankers were happy to see that my top line revenue (sales) had been growing month over month. With each franchise we added to the company we added sales. But what we never addressed was that the money I took home from all that top line revenue was non-existent. I wasn’t taking a paycheck – shocker I know! Even with a seven figure business and a massive team (who always got a paycheck, benefits and even retirement, by the way) I didn’t get a salary. I didn’t have a business savings account. The business was riddled with debt and my stress levels were through the roof.

Why? Because I was focused on sales, not profits.

Constantly chasing the next sale without understanding the storm brewing beneath the surface had my expenses increasing right along with the sales, and therefore the profits shrank.

By this point, if you’re asking yourself why a focus on profit over top line revenue matters, and what’s this about becoming a “profit genius,” then you’re already on the right track!

If you have had the opportunity to read my first book, “Inventory Genius” you might remember that I explain that “By definition a genius is an extremely intelligent of skillful person. Someone who possesses a very high skill or ability”. The definition for a “profit genius” follows. If we are going to do business well, let’s work towards producing the ability to create profit more than anything else.

My sincere hope for you is that you will read this book with a heart open to learn. I want you to come away with the deep desire to be a business owner who does everything on purpose and with intention.

I want you to take a paycheck.

I want you to stop playing store with your store.

I want you to pay off that debt and find financial freedom.

I want you to find the confidence to be the boss of your business and the boss of your numbers.

I want you to become a profit genius.

I know you can. I know this because I have helped guide hundreds of inventory base business owners as they did just that. I have watched as they have unshackled themselves from the grind of business ownership and have turned their ships around. I have watched as they paid off debt, set out on a mission to bring their spouses home from work, paid for family vacations, and even closed their businesses because they chose to not stay open - not because they were forced to close the doors. Why did they have this choice? Because profit finally gave them the opportunity to choose what they really wanted to do with their life.

I have watched as they have created savings accounts, built up retirements, sold businesses and learned to say no to things they just didn’t want to do.

And you know what drove all this incredible change? Profit did. Not sales, but profit on those sales. Because at the end of the day, what good is cash from any of that revenue if you never get to keep any of it?

And with that, let’s dive into what it will take to become a profit genius.