well that depends on why a business is or isn't in profit. In our case we are in profit if I choose to stop spending the profit on further growth. For example our month to month expenses are about £30K, our turnover is about £50K take the Vat off that which is about £6K (after claim backs) and we have a pre tax profit of £14K a month, which I either spend on more marketing or not.
So on paper we are well into profit. The reason I said 2 years is because that's how long I intend to keep spending to grow at this pace. If we open a second base next year then we continue to spend the profit.
What I think you meant by profit is our turnover not exceeding our fixed monthly expenses........................... Is everyone still paying attention? lol
If you're spending that £14k you aren't in profit and it's possible that the marketing spend is needed to drive one offs because there isn't enough regular scheduled work. I get your point, but on paper you are making a loss. I'm quite certain you will be in profit once you reach saturation for the vans you already have mind.
Sorry but thats not correct as I have explained there. We dont do one offs for a start . I am choosing to not be in profit by spending the profit, If I choose to do no marketing in a month then we have clear profit.
Yes bungle that includes the wages. Once again I have clearly mentioned fixed and chosen expenses in the breakdown. Clearly wages are a fixed expense that I cannot choose to not pay each month
No my origional plan would deliver the origional amount but I have extended that plan because im enjoying the process and I simply want to earn more money in the long run. Why stop at earning 10K a month when it could be 20 for another 2-3 years effort.
Technically though you are increasing revenue not profit. If you are spending your profit back into growth ( very wise btw) that profit now becomes an expense and what you are left with after this is your profit (technically)
What you are saying is once you pull the plug on marketting you will very quickly be in profit as you will have a much higher revenue than you would have if you simply stopped now.
Great plan though, im going to do the same...It makes perfect business sense to invest most of your profit back into marketting, you only pay tax on profit so why not shove it all back in reduce your taxes and grow your turnover/revenue then in a few years time pull the plug. Just like water building up behind a dam, looks like you have nothing for years then bam break the dam and watch the flood...if you keep taking money out of the business it will only ever produce drips of money for you never a flood