Unlocking Financial Health: Implementing Profit First Today

Ready to make profit a habit from day one? In this episode, I’m guiding you through the essential steps to implementing Profit First, inspired by Chapter Five of the book. Whether you’re just starting out or looking to finally get your business finances working for you, this is your roadmap to sustainable profitability.

I’ll break down exactly how to set up your Profit First accounts—covering income, profit, owner’s pay, tax, and operating expenses—so you can allocate your funds with clarity and intention. We’ll talk about why consistency matters, how to establish a simple allocation rhythm, and the power of celebrating your profits every quarter.

You’ll hear real-life success stories from UK business owners who’ve transformed financial chaos into clarity and calm with Profit First. Plus, I’ll share practical tips for working with your accountant, getting past any scepticism, and making the system work for your unique business—whether you’re a manufacturer in Sheffield or a freelancer in Cornwall.

This episode is all about taking control, finding efficiencies, and building a business that supports your goals (not the other way around). I’ll finish up with clear, actionable steps so you can get started today—setting up your accounts, reviewing expenses, and shifting your focus to profit.

Takeaways:

• Learn how to set up and use Profit First accounts for better cash flow and less stress.
• Discover the importance of consistent, quarterly profit celebrations.
• Find out how reviewing expenses can boost your bottom line.
• Get practical advice for working with your accountant and making Profit First your own.
• Start transforming your financial habits with simple, actionable steps.

Links mentioned:

financiallyhealthybusiness.co.uk

debhalladay.co.uk

Companies and resources featured:

Accounts Ladies, Accounts Office Training Academy, Starling, Monzo

Episode Transcript

(00:09):
Welcome to Profit first withDeb Halliday.
That's me.
I'm Deb.
I'm a Profit firstprofessional and trainer, author
of how to Build a FinanciallyHealthy Business, founder of the
Accounts Ladies, an awardwinning accountancy practice and
the Accounts Office Training Academy.
This is the show for businessowners who want to stop stressing
over money, keep more cash,pay themselves more and build a business

(00:33):
that truly thrives.
Just a quick note, Profitfirst is a licensed methodology.
Everything here is designed tohelp you implement it in your own
business.
If you're interested inhelping others with Profit First,
I'll share how you can applyto become certified too.
Let's get started, becauseyour business should work for you,

(00:54):
not the other way around.
Hello and welcome to Profitfirst with Deb Halliday.
I'm Deb Halliday, your UKProfit first professional.
And today we're coveringChapter five of Profit First.
Day one quarter, one year, oneand forever.
This episode is your roadmapto start Profit first today and make

(01:17):
it a lifelong habit.
Let's dive in.
Chapter five is where Profitfirst comes alive.
Mike Michalowicz lays out aclear plan to implement the system,
starting small and building momentum.
Whether you're a Sheffieldmanufacturer or a Cornwall freelancer,
this works.
The key is action.
Set up accounts, allocatefunds and celebrate profits quarterly.

(01:39):
Let's break it down for UKbusinesses Day one.
You don't have to, but you cantell your accountant you're using
Profit First.
They might raise an eyebrow.
Some UK accountants think it'sunorthodox, but it's just a cash
flow system, not a replacementfor bookkeeping.
Set up your accounts.
Income Profit Owner's Pay taxand operating expenses.

(02:03):
Use a UK bank like Starling or Monzo.
Label accounts clearly likeprofit 5% or tax 20%.
Deposit all income into theincome account.
Then allocate according toyour caps current allocational percentages
that you worked out from yourinstant assessment.
For example, 1% to profit, 20%to tax, 30% to owners pay, etc.

(02:29):
Quarter 1.
Establish a rhythm.
Every 10th and 25th, allocatefunds based on your taps.
For example, a £10,000 depositmight split £1,000 profit 10% 3,000
pound owners pay 30% £2,000tax £4,000 operating expenses.

(02:49):
40% pay bills from operatingexpenses only.
Cut cost by 10%.
Cancel unused software ornegotiate supplier terms at quarter's
end.
March 31, June 30, etc.
Take 50% of the profit accountas a bonus.
Save the rest as a rainy dayfund year one and forever increase

(03:10):
taps gradually by quarter two.
Aim for 3% profit by quarterfour 5% check your tax account annually
with your accountant to coverHMRC obligations.
Jorge and Jose from the bookstarted with 2% profit and now enjoy
dream vacations.

(03:31):
Their business serves them,not the other way around.
What if I can't cut 2 10% of expenses?
Start small.
A Swansea retailer I workedwith saved 500 pounds monthly by
switching to a cheaper energy tariff.
Review your P and L in 0.
Every pound counts, Mike says.
Efficiency comes when you'reforced to work with less.

(03:53):
Meet Liam, a Newcastle photographer.
His £170,000 business was chaotic.
Late VAT payments, no savingson day one.
He set up Monzo pots forprofit first.
By quarter one he allocated 2%profit, 20% tax, 35% owner's pay
and 43% operating expenses.

(04:16):
He cut 1,200 pounds in annualsubscriptions by year one.
He took his profit bonuses,paid HMRC on time and hired an assistant.
Liam's now planning a studioupgrade, all from Profit.
Your ACTION STEPS Set up youraccounts today.
Visitfinanciallyhealthybusiness.co.uk for

(04:40):
a UK setup guide.
Revamp your to do list toprioritise profit.
Subscribe for future serieslet's make Profit First Forever.
Thanks for tuning in to Profitfirst with me.
Deb Halliday if you foundtoday's episode helpful, please subscribe.
Let leave a review and shareit with another business owner who

(05:01):
needs to hear this.
For more resources, coursesand to connect with me, head to debhalladay.co.uk
and remember, when you putprofit first, you build a business
that reduces the stress whileit supports your goals and dreams.
See you next time.

(05:24):
SA.