Quick hits

Quote of the Month:

​

Tax Tip of the Month

​

Finance Tip of the Month

​

Your Breakaway Growth Navigator

Last month, we talked about scaling with confidence and how to grow without losing your margins, your cash, or your sanity.

This month, we’re zooming in on what makes that possible: putting profit first—on purpose.

Too many business owners treat profit like a nice surprise. Whatever’s left at the end of the month must mean things are going well…right?

But what if profit became the starting point instead of the leftover?

Why Profit Has to Come First

Traditional accounting says: Revenue – Expenses = Profit

But when profit is an afterthought, it’s usually inconsistent or nonexistent.

The Profit First approach flips the formula: Revenue – Profit = Expenses

You decide how much profit you want to keep, then build your spending around that decision. It’s a simple shift, but it changes everything.

The Red Bike Advisors Profit First Cheat Sheet

While traditional Profit First systems often rely on opening multiple bank accounts, we’ve found that approach can feel overwhelming and create additional accounting complexities.

Instead, we recommend starting with expense ratios.

Begin with your target net profit, then allocate the remaining revenue across:

• Cost of Goods Sold
• General & Administrative
• Sales & Marketing
• Reinvestments (equipment, hiring, etc.)

All ratios add up to 100%. The result? A clear, visual plan that shows exactly where your money should go and where it’s currently leaking.

When you compare target ratios to your actual numbers, the path forward becomes obvious.

Use Profit as Your Decision Filter

Every industry has a profit benchmark, as well as benchmarks for COGS, Admin, and Sales & Marketing. Start with that profit benchmark and work backwards:

• How much profit do I want this year?
• What revenue supports that goal?
• Which expenses are necessary and which aren’t?
• How much can I reinvest without stressing cash flow?

You Deserve to Be Paid—First and Well

You didn’t start your business to be broke, burned out, or constantly behind.

You started it for freedom, fulfillment, and flexibility.

So here’s your permission (and your plan) to:

• Benchmark your current expense ratios against your industry
• Meet (and then beat) your industry benchmarks
• Prioritize profit
• Pay yourself what you're worth
• Build a business that supports your life goals, not just eats your time

​

Client Story of the Month

It pays to closely review IRS transcripts. We had a client who owed $600K in back taxes, fees, and penalties encompassing several years. We did our first phase of work by securing POAs, pulling transcripts and doing a review. Our review indicated that the CSED (Collection Statute Expiration Date) for $188K would expire in July 2025 and another $108K would expire in January 2026.

We gave our client the option to have us do financials and negotiate an installment agreement or ride out the CSEDs and then do the installment agreement. Our client chose monitoring, and the bottom line is that the taxpayer now owes $296K less than when they came to us.

​

New Around Here

Meet Gwenyth Gustafson, our new Client Relationship Manager. Gwen helps clients navigate financial and tax decisions with clarity and confidence. With a thoughtful, supportive approach, she connects clients with the right solutions and makes even complex situations feel manageable. We’re excited to have her on the team. Welcome, Gwen!

​Meet more members of the team >

Who do you know that needs our services?

We're accepting new clients for...

​1. Accounting, Tax & Advisory​

​2. Tax Controversy & Resolution​

​3. Fraud Investigation & Forensic accounting​

Who do you know that needs our services? Let us know--we're happy to help!

​

A Question for You

Before every new hire, subscription, or investment, ask one simple question: Will this help us hit our profit goal?

To stay aligned:

• Review your expense ratios monthly
• Block 60 minutes each month to review metrics and cash—solo or with your team
• Identify what’s working and what’s quietly draining profit

​

Until next month,

Your Red Bike Advisors Team

​

​About Red Bike Advisors​

We're on a mission to equip small business owners with finance and tax insights that create exponential value for their companies, customers, employees, and families. From financial reporting to forecasting, we take the confusion and scramble out of business finance and tax strategy and bring in clarity, growth, and peace of mind.

1650 Military Cutoff Rd. Suite 104, Wilmington, NC 28403
​Click here to opt out of emails · Preferences​