Income Statement (P&L) for Small Services Businesses

Managing the P&L

Your profit and loss statement in your services business can give you important insights into the health of your business. Whether you’re a small solo business or a big global enterprise, managing your P&L is critical.

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If you run a business, you need to have a monthly profit and loss statement (P&L).

Big global companies have robust P&Ls. But it’s not just something that benefits big enterprises or companies that produce physical products.

Companies that provide services, whether you’re a big shop or a solo part-time entrepreneur, need a P&L too.

Why do you need a P&L as a small business? It tells you important facts about the health of your business.

And it will help you ensure your business can survive seasonal swings or big economic downturns too.

So what does a P&L for a services business contain? It can be difficult to figure out, since you’re not moving tangible products. But it’s not any less important for your services business.

And what insights does it hold for your overall business?

That’s what John Arnott will cover in this video as part of the Business Mastery series.

You must manage and monitor your business finances – find out how in this video using your P&L.

You’ll learn how you’re doing, and what you need to fix first.

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Additional Marketing Resources:

[janriccal]

I loved how you patiently broke down the 4 key components of a P&L.

[AFULLERROOFLIFE]

My dad just came over and ask me how my construction company was going…. He ask about my P&L sheet I said what !? 4 hours later I have a complete p&l statement! 🎉 I was running my business like a checking account. He said that doesn’t tell me anything I need to keep an updated P&L report. I’m 35k in the black with 45k in future sales.

Love your video!

[sharyndriver]

Thank you, John, you explained the P&L and percentages so well. Fabulous advice regarding reserves. 😁

[samuelreynolds]

Profit and Loss statement made simple, thank you.

[pedrovaldes]

Thanks, i was looking for a video less technical and more conceptual

[smkymtnsaws]

I’m going to have to watch this a couple of time

[MPPeane]

I really enjoyed the simple explanation and detailed breakdown of why certain things have to be a specific way. I also enjoy your calm steady demeanor, helped me to focus and grasp info.
Thank you

[nicklaus]

Thanx so much for the additional percentage analysis. It makes P&L so much more meaningful and speeds up decision-making.

[zetteetien]

I really enjoyed watching your video. As an entry-level manager, I wanted to learn more about the P/L. I thank you for the vital information.

[mariselatamayo]

thanks for sharing all good information

[lcmlcm]

Thank you for the best explanation of a profit and loss. I will subscribe to see what other great stuff you have.

[dsoremi]

Thank you very much for the insight! It's helping to create right financial planning for my new startup solution right here in Nigeria. Thank you very much!

[wigsbybritt]

Thank you so much for this break down!!!

[ilonailona]

great - thank you so much, I am going to follow you

[jennifersgolftrip]

Thanks for the video. Very informative.

[RussHess-js]

Revenue? Is this gross sales of products and services or net sales of such, Gross less collected sales tax?

[jaymarlon]

Very helpfull, hope you can assist in sales and marketing budgeting? Thank you!

[NubeLounge]

Hi,
Question That driving me crazy lol, how do you handle rolling over profits for example my June profits is currently paying for my aug inventory, Im at the point were my business is breaking even its a start up. if I add my rolling profits my cost of good sold percentages are lower for that month so its no fully accurate. I Would I use my actual sales but then my net profits would be off because ill be negative whatever my inventory cost

[gcbusiness]

If you are funding your single LLC business do you put your your contributions in your p&l statement

[vivekvishal]

Dear John,

Thanks for this video. Can you pl share your email