by Dr Greg Chapman
For many business owners, the Profit and Loss statement is something their accountant prepares each year for the tax department, the sole purpose of which is to reveal just enough to the bureaucrats so that their tax can be minimised. However this powerful tool is probably the most underutilised one in a small business owners’ arsenal.
The P&L I usually see is just: Income – Expenses = Net Profit. That’s all the tax office actually need. They don’t care if some parts of your business are more profitable than others. If you have obvious opportunities to increase sales. That you are charging enough to cover the costs of all services. But YOU should.
May You Business Be - As You Plan It!
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Dr Greg Chapman is the Director of Empower Business Solutions and is Australia's Leading Advisor on Emerging Businesses and provides Coaching and Consulting advice to Australian Small Business Owners in Marketing & Business Strategies Planning & Systems. He is also the author of The Five Pillars of Guaranteed Business Success and Price: How You Can Charge More Without Losing Sales.
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