Episode 205: Profit vs Owner's Salary - Business Tip of the Month with Hal Denbar of National Pool Partners

Episode Summary: 

In this edition of Business Tip of the Month, we’re joined by NPP’s President of Texas Hal Denbar. 

Listen in as Hal breaks down the important but often misunderstood distinction between making a profit and paying yourself as a business owner. 

He also explains the advantages of having an accountant and how to build a healthy pool business using the profit-first model. 

Topics Discussed: 

• 01:14 - Defining the problem 
• 02:37 - Profit versus owner’s salary 
• 04:29 - The advantages of having an accountant 
• 05:12 - Misconceptions around profit and salary 
• 07:18 - Making it a habit to check your numbers 
• 10:57 - Using the profit-first model 
• 15:55 - Determining how much to pay yourself 
• 18:18 - What counts as a “healthy” pool business 
• 20:32 - The consequences of failing to grasp the differences 

Connect with Guest: 

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Connect with Pool Chasers: 

• Website 
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• Facebook 
• Facebook Group 
• Twitter 
• YouTube 
• Patreon 

Key Quotes from Episode: 

• The owner’s salary, ideally, should be something that the owner specifies for themselves as a W-2 salary that’s realistic. 
• We don’t often take the time to look at our numbers in a true business sense, not just in a tax sense. 
• The profit-first model encourages you to determine how much profit you want out of your business, then to build your business around achieving that level of profitability. 
• If you want to be a healthy business in this industry, you should be looking for a 10-20% profit margin.