“I expected things to get easier once I hit a million in sales. But here I am, still struggling. I don’t know where the money goes.”
I hear some version of that every time I talk to a new client or ecom owner.
I understand where they’re coming from, I mean a million dollars was supposed to be the finish line.
They worked for it. They earned it. But the bank account didn’t get the memo.
The revenue says one thing and the bank still says another. Why?
At ProfitCon, the Profit First Professionals conference that I attend every year, I heard Ron Baker speak.
Ron has spent decades teaching businesses to price on value instead of hours.
He said something I wrote down right away. “Profit is the applause, not the performance. It’s the result.”
Let’s dig into that a bit more.
Most of us chase the applause directly, more sales, more SKUs, more ad spend, waiting for profit to show up at the end.
When we don’t see the profit show up, we assume we need more of those same things and start the process over again.
You’ll get the same result, because you need to change your performance.
Ron shared a picture of what that performance looks like.
Four overlapping circles with human flourishing in the middle: health and wellbeing, wisdom and understanding, purpose and meaning, and wealth and prosperity.
What I want you to see is that wealth is only one of the four, and it tends to show up when the other three are cared for.
That’s been true for my clients and it’s been true for me, too.
So over the next few weeks, I’m going to walk through each one of these circles by answering the questions I hear from ecom brand owners:
- Why do I still worry about money when sales are good?
- Why doesn’t my P&L match my bank account?
- What am I building all this for?
- When do I get to pay myself?
- And finally, what does thriving actually feel like?
You don’t have to have the answers to these yet, you just have to be willing to look at the performance as well as the applause.
Which of those questions keeps you up at night?
Hit reply and tell me. It’ll help shape what comes next.
Cyndi
Quick Summary
Many ecommerce owners reach a million in sales but no profit seems to follow, and the bank account doesn’t reflect the revenue. At ProfitCon, the Profit First Professionals conference, Ron Baker described profit as “the applause, not the performance.” Profit is the result of how a business is run, not something you can chase directly with more sales, more SKUs, or more ad spend. Baker’s model of human flourishing has four overlapping circles: health and wellbeing, wisdom and understanding, purpose and meaning, and wealth and prosperity. Cyndi Thomason, founder of Your Profit Team, explains that wealth tends to show up when the other three are cared for.
Frequently Asked Questions
Why do I have a million in sales but no profit?
Revenue and profit are different results. Many ecommerce owners grow sales by adding SKUs, increasing ad spend, and chasing more volume, but costs grow right along with revenue. Without a system that sets aside profit first, the money gets spent before it ever reaches the owner. More sales repeats the same pattern at a bigger scale.
What does “profit is the applause” mean?
Ron Baker, a pricing expert known for teaching businesses to price on value instead of hours, uses the phrase to explain that profit is the result of a business’s performance, not the performance itself. Instead of chasing profit directly, owners need to change how they run the business, and profit follows.
What are the four circles of human flourishing?
Ron Baker’s model shows four overlapping circles with human flourishing in the middle: health and wellbeing, wisdom and understanding, purpose and meaning, and wealth and prosperity. Wealth is only one of the four, and it tends to grow when the other three are cared for.
Why doesn’t my P&L match my bank account?
A P&L can show profit while the bank account stays low because cash goes to inventory, debt payments, and other costs that don’t appear as expenses right away. Your Profit Team helps ecommerce owners use Profit First to make cash and profit visible in their bank accounts.
How can Your Profit Team help ecommerce owners become more profitable?
Your Profit Team is a fractional CFO advisory service for ecommerce brands, built on the Profit First methodology and founded by Cyndi Thomason. The team helps owners understand where their money goes, pay themselves consistently, and build businesses that support the life they want.
Ready to Change the Performance?
If your sales are growing but your bank account isn’t, let’s talk. Book a discovery call with Your Profit Team and find out where your money is really going.
Related reading: Why Is My P&L Showing Profit When There’s No Cash in the Bank? | More Revenue Isn’t Solving My Cash Problems — What Will? | How Does an Introvert Win the Cheerleader Award?
