Cash Flow
Profit First
Mike Michalowicz
A simple discipline for cash flow and actually keeping profit.
Recommended for: I Don’t Know What to Charge
All Challenges
Money
I Don’t Know What to Charge
You are unsure whether your prices are too high, too low, or actually profitable.
The Challenge
Build selling prices from direct costs, labor, materials, subcontractors, equipment, overhead, insurance, sales costs, risk, and profit.
Why This Happens
- The problem has not been defined clearly enough to solve.
- Daily urgency has replaced a consistent process.
- The business is not measuring the few activities and results that matter most.
Questions to Ask Yourself
- 1.What is happening now?
- 2.How long has this been a problem?
- 3.What have you already tried?
- 4.What result do you want in the next 90 days?
- 5.What number would show improvement?
- 6.Who owns the next action?
What to Do First
1
Write down the current facts without assumptions.
2
Choose one measurable result for the next 30 days.
3
Schedule the first action and assign clear ownership.
Step-by-Step Solution
- 1
Identify the root cause instead of treating only the symptom.
- 2
Choose the smallest practical action that can create evidence.
- 3
Use the related tool or worksheet to organize the work.
- 4
Review progress every week and adjust from real results.
- 5
Share what worked so another owner can learn from it.
Three Levels of Solutions
Quick Win
Do this today
Calculate your true hourly overhead with the Overhead Calculator.
Build the System
Next 30 days
Build a pricing sheet based on real costs, overhead, and target margin.
Long-Term Transformation
Where you're headed
Confident pricing based on numbers, with customers who value your work.
Lessons From the Pass It On Library
From Profit First
Revenue does not equal available cash — price for profit.
Framework: Allocate first: Profit, Owner Pay, Taxes, Operating Expenses.
From Business by the Book
Charge fairly and honestly for real value.
Framework: Biblical Business Decision Check
Pass It On Action
Update your price on one service using real overhead.
Your Action Plans
Sign in to check off steps and save progress to My Growth Plan. Sign in
7-Day Action Plan
- Day 1 — Identify the problem: write down exactly how “I Don’t Know What to Charge” shows up in your business.
- Day 2 — Review the numbers: gather the facts, figures, and examples connected to this challenge.
- Day 3 — Find the root cause: answer “What is happening now?”
- Day 4 — Choose one change: Write down the current facts without assumptions.
- Day 5 — Assign responsibility: name ONE owner, a deadline, and the expected result.
- Day 6 — Implement: Choose one measurable result for the next 30 days.
- Day 7 — Review what happened: what worked, what didn’t, and what you’ll do next week.
30-Day Action Plan
Week 1 — Diagnose
- Answer: What is happening now?
- Answer: How long has this been a problem?
- Answer: What have you already tried?
- Complete the 7-Day Action Plan.
Week 2 — Build
- Build a pricing sheet based on real costs, overhead, and target margin.
- Identify the root cause instead of treating only the symptom.
- Choose the smallest practical action that can create evidence.
- Use the related tool or worksheet to organize the work.
Week 3 — Implement
- Review progress every week and adjust from real results.
- Share what worked so another owner can learn from it.
- Train the people involved and assign owners.
Week 4 — Measure & Improve
- Compare results to where you started.
- Write one lesson learned.
- Adjust the process.
- Share what you learned with someone in the fellowship.
Biblical Principles
Wisdom for the journey — encouraging stewardship, integrity, and service, never a promise of guaranteed success.
#31 · Integrity
Use honest measurements
Proverbs 11:1
#39 · Integrity
Practice fairness
Proverbs 16:11
#62 · Customers
Create genuine value
Philippians 2:4
Related Challenges
Recommended Books
Approved Bookshelf resources related to this challenge.
Faith & Business
Business by the Book
Larry Burkett
Biblical principles for running a business with integrity.
Recommended for: I Don’t Know What to Charge
Pass It On may earn a commission when you purchase through certain links on this site, at no additional cost to you. These commissions help support the mission and programs of Pass It On. Read the full disclosure.
Still Stuck? Ask the Community
Tell us what you are facing, what you have tried, and what outcome you want.
Sign In to Ask for HelpHow Others Solved This
Real lessons from Pass It On members, shared after administrator review.
No member stories yet for this challenge — yours could be the first.
Share how you solved it
Protect confidential information: no customer names, employee details, addresses, pricing, contracts, or financial records.
Sign In to ShareYou don't have to build alone.
Challenge → Diagnose → Prioritize → Learn → Take Action → Measure → Improve → Help Someone Else
Learn it. Apply it. Pass it on.