AIE 181: Car Wash Cash Flow: Small Business Financial Tips

Lauren and Rocky open up the conversation talking about what success means in business. Most business comes down to math, and simple math at that. If you sit down before starting a business and do the math, you should have an idea about whether the business can be successful. The conversation takes a turn towards cash washes, which Lauren welcomes. Is this really becoming as oversaturated as it seems? Lauren then asks Rocky to demystify and differentiate “money” in business: revenue, profit, cash. A huge key to understand here is that you can have a profitable business that runs out of cash. This occurs when you try to grow too fast. Not enough business owners understand this! Rocky also points out that you should be aware of some initial success, and that it won’t necessarily continue. He also recommends using conservative numbers when “underwriting” your business plan. Lauren then asks Rocky about buying a business. Is that easier than creating one? You should take into account how much involvement the owner has, the client number and mix, and more. This is when rocky explains the Profit First system, which is very like paying yourself first in the personal finance realm. Speaking of personal finance, Rocky touches on the importance of separating personal and business finances. Rocky closes with reminding people to do the math before they start (or buy) the business they’re considering. He warns us about going into franchises. It should make business sense, not passion sense.

If you liked this episode, you’ll also like episode 67: Starting Your Own Business or 140: Online Businesses.

About Rocky:
Rocky Lalvani is the Chief Profitability Adviser for business owners. He teaches them how to ensure they get paid and make profit a priority! As a certified Profit First Professional, he implements Mike Michalowicz's Profit First System. Rocky started with nothing when his parents immigrated to the United States when he was two years old, and his parents were in their 40's. It was his parents' second time starting over in life as they moved here to experience the American dream. Despite a lot of struggles and his mom passing away when Rocky was 7, he has achieved financial and life success. Rocky loves to share his journey and inspire others to achieve their dreams even faster.

Connect with Rocky:
http://richersoul.com/
https://profitcomesfirst.com/
LinkedIn - https://www.linkedin.com/in/rocky-lalvani/
Facebook - https://www.facebook.com/richersoul
Instagram - https://www.instagram.com/richer.soul/
Twitter - https://twitter.com/rockylalvani

Connect with Lauren:
https://twitter.com/AdultingIsEasy
https://www.instagram.com/@adultingiseasyreal
https://www.housemoneymedia.com/