Without an understanding of profitability, every business, no matter how big, no matter how “successful,” is a house of cards

In Profit First: Transform Your Business from a Cash-Eating Monster to a Money-Making Machine, Small Business author Mike Michalowicz describes a framework that he calls “Profit First”. It is a behavioral approach to accounting wherein the entrepreneur takes profit first and appropriates only what remains for expenses. Mike noted that by following this approach, entrepreneurs will transform their businesses from cash-eating monsters to profitable cash cows.

A financially healthy company is a result of a series of small daily financial wins, not one big moment. Profitability isn’t an event; it’s a habit.