Discussion in 'Investments' started by Searchit, Mar 9, 2016.
What % of your earnings goes back into your own company?
this can go 2 ways... if you are a beginner invest 100% of it back in. this is the only way to scale up faster. if you are a oslid business, invest what you put in plus another 20-50% depending how much growth you want. so for example, if you avg ad spend is 10k a day increase it to 15k a day. it is all about how you want to grow and kill it. but you also need ot have your balance in life. When starting out definitely invest 100% to rapidly grow.
In the beginning while I agree that the amount you reinvest should be a lot more than what a well established company will have to, I'm not sure I'd put the figure at reinvest 100% back in.
That will leave you walking a bit of a tightrope financially, as everything you have will be tied up in the business. Even if you drop that figure down to 90% then at least if things stop going so well in the future, at least you've got a bit of money put to one side, that you can then decide what to do with.
Since the purpose of starting a business is to make me some money, I wouldn't reinvest all the profits.
It's better IMHO [for some people (like me) it is] to grow your business slowly so the most I'd put back in would be 35%. 15% would be placed in a savings account so in case of anything I'd have some money to prop up the business.
When I was drawing up a business plan, I decided that we will try to create a salary plan once we started making a profit. That way I could earn a salary and all profits would be reinvested in our company if it was doing well. This way seems like the best way for our business as we would need to buy more stock and invest in different delivery services. I think it all depends on your goals and needs.
i reinvest this year 80% of my income
Q1: 68% of the net
110%. I was taught that the leaders in our company that hit 200k in monthly sales the quickest, gave up the majority of the profits. It seems to be working. Others on my team that "pay it forward " seem to be consistently experiencing growth too.
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