How to Read a Profit and Loss Statement for Small Businesses in Schaumburg

How to Read a Profit and Loss Statement for Small Businesses in Schaumburg

Simple guidance for business owners who want to understand their numbers

Running a small business in Schaumburg is no small feat—between serving customers, managing staff, and keeping up with everything else, it’s easy to overlook the financial side of things. But one document you don’t want to ignore is your Profit and Loss Statement (also known as a P&L or Income Statement).

Whether you’re a contractor, shop owner, or service provider, this one report can tell you if your business is actually making money—or just getting by.

So, let’s break it down in plain English.

🧾 What Is a Profit and Loss Statement?

A Profit and Loss Statement shows your income, expenses, and profit (or loss) over a specific period—usually a month, quarter, or year.

It answers the question:

“Am I profitable?”

If you’re in Schaumburg and working hard every day, you deserve to know what’s working and what’s draining your resources. The P&L gives you that insight.

📊 What You’ll Typically See on a P&L

Revenue (aka Income or Sales)

This is the money coming into your business from your services or products.

👉 Example: If you’re a landscaper and made $15,000 in May, that’s your revenue.

Cost of Goods Sold (COGS)

These are the direct costs of providing your service or product—like materials, supplies, or subcontractor payments.

👉 For a cleaning business, this could be cleaning supplies and employee wages tied directly to each job.

Gross Profit

Revenue minus COGS.

This is what you have left before covering your overhead (rent, software, marketing, etc.).

Operating Expenses

These include:

• Rent or utilities
• Software subscriptions (like QuickBooks)
• Marketing and advertising
• Insurance
• Office supplies
  👉 Basically, what it takes to keep your business running—whether you have one customer or fifty.

Net Profit (or Loss)

This is what’s left after everything.

Revenue - COGS - Expenses = Net Profit

If this number is negative, you’re running at a loss. If it’s positive—congratulations, your business is profitable!

📍 Why Schaumburg Business Owners Should Care

You might be asking, “Do I really need to look at this every month?”

Yes—especially if you want to grow your business intentionally.

Here’s why:

• Catch problems early. If your expenses are climbing, a monthly review helps you spot it fast.
• Plan for taxes. No more scrambling in April—you’ll know exactly where you stand.
• Make smarter decisions. Thinking of hiring or expanding? Your P&L helps you decide if it’s the right time.

👀 What to Watch For

• Are your expenses growing faster than your income?
• Is your gross profit consistent month to month?
• Are certain months more profitable than others?
  (This is especially helpful for seasonal businesses in Schaumburg.)

💡 Quick Tips

• Don’t just look at the numbers—compare them month to month.
• Use accounting software like QuickBooks Online for easy, up-to-date reports.
• Don’t be afraid to ask questions—your bookkeeper should be your financial translator.

🤝 Need Help Reading Yours?

At AAG Wise Bookkeeping, I specialize in helping small business owners in Schaumburg and surrounding areas not just track their finances—but actually understand them.

If your P&L feels like a foreign language, you’re not alone. I offer:

• Flat-rate bookkeeping services
• Easy-to-understand financial reports
• One-on-one support that meets you where you are

📞 Let’s talk—your first consultation is free.

And yes, I offer one month of free bookkeeping for new clients (with a 12-month commitment).

  Final Thought

Numbers don’t have to be scary.

When you understand your profit and loss statement, you take back control—and that’s where clarity, confidence, and growth begin.