Simple Numbers, Straight Talk, Big Profits!

Crabtree is an accountant who works with owner-managed businesses, and this book sets out a small set of financial rules aimed at founders who run companies in the one to fifty million dollar revenue range and who do not have a finance function.

The rules are specific and arithmetic. Owners should pay themselves a market-rate salary and treat it as a cost, so that reported profit reflects the business rather than the owner's compensation decisions. Labour efficiency ratio, defined as gross profit divided by total labour cost, is the metric that determines whether the business scales, and Crabtree gives target values. Salary cap, meaning total salaries as a share of gross profit, should stay within a range or the business cannot fund growth. He argues for a target of ten to fifteen percent pre-tax profit as the level at which a business is genuinely healthy and can self-fund, and that below five percent the owner is buying themselves a job.

The cash management material is the most useful. He explains why growth consumes cash, sets out a four-account system separating operating cash, tax reserves, owner distributions and retained capital, and argues the owner should set aside tax money before treating any cash as available.

The book is practical, narrow and repetitive. It is written for American small businesses and the tax material reflects that. The specific ratio targets rest on Crabtree's client experience rather than on any study, so they are benchmarks from one practice rather than established norms. Founders in capital-light or venture-funded businesses will find much of it inapplicable.