Making a profit: list all expenses

Businesses are supposed to do more than make money. A business is supposed to make a profit.

List all company expenses - monthly and infrequent expenses. Not knowing all expenses can paint a false sense of profitability.

After listing all expenses, determine income and what customers brought in what percentage of income.

A friend of mine has 30 clients and he estimates that 80% of his business comes from 12 - 15 of those clients. He does well keeping up with his most profitable clients. But because he finds it easiest to spend time with them, he doesn't get out to generate new business.

Another expense: understanding where time is spent.

My thoughts on making a profit are inspired by reading the book by George Cloutier Profits Aren't Everything, They're the Only Thing and writing about it briefly on my column in Examiner.com as the LA Business News Examiner.

Do you know your expenses or have a good idea of what they are?

If not, set aside the time to write them down and review receipts to get a handle on cash flow for your company.