Profit-Making and Profit Management

The Purpose of Profit

What is “profit”?

•     Earning a profit = Selling something for more than it cost you to make it

•     Your profit doesn’t make what you’re selling less valuable.

•     A reflection of value-making and efficiency

•     Enables us to multiply our resources

 

The Purpose of Profit

•     Profit helps your company grow … and prevents it from dying.

•     Profit is like oxygen … you don’t enter life with the end goal of breathing oxygen

 

“We don’t make movies to make money. We make money to make more movies.”

—Walt Disney

Profit matters to God.

“Engage in business [make value] until I come.”

                                                                  —Luke 19:13

“Then he said to those standing by, ‘Take his mina away from him and give it to the one who has ten minas.’

‘Sir,’ they said, ‘he already has ten!’

He replied, ‘I tell you that to everyone who has, more will be given, but as for the one who has nothing, even what they have will be taken away.”

—Luke 19:24-26

“She perceives that her merchandise is profitable.”

—Proverbs 31:18

 

God values profitability.

•     Profit helps your company grow … and prevents it from dying.

•     Profit is like oxygen … you don’t enter life with the end goal of breathing oxygen

 

“We don’t make movies to make money. We make money to make more movies.”

—Walt Disney

Potential Uses of Profit

•     Owners spend on themselves (or save for themselves)

•     Expand capacity

•      Hiring

•      Capital expenditures

•     Research and development

•     Sharing

•      Profit sharing with employees (e.g., bonuses)

•      Employee care programs

•      Philanthropy

 

You must have some “ownership” to control the company’s profit.

•     Employees are typically paid just enough to cover their own living expenses.

•     Employees can generate profit but don’t own it—unless there is some profit-sharing agreement in place.

•     As an owner, don’t charge just enough to cover your expenses.

•     Charge enough to be profitable.

Be Eternally Profitable

•     The foolish rich man hoarded profit (Luke 12:13-21)

•     The unrighteous steward shared profit (Luke 16:1-13)

•     Loss-leader living

•     God promises rewards

•      “We must all appear before the judgment seat of Christ [bēma], so that each of us may receive what is due us for the things done while in the body, whether good or bad.” (2 Cor. 5:10)

•      “Then your Father, who sees what is done in secret, will reward you.” (Matt 6:4)