Many businesses offer “loss leaders” to introduce themselves and their capabilities to new customers. Many agencies do something similar when they agree to write only one line of business for a customer. This can be a great strategy, but only if you can track progress. In a year or two, your tracking should show you’ve picked up additional lines of business to make the account profitable. (Credit: Blue Planet Studio/Adobe Stock) Many businesses offer “loss leaders” to introduce themselves and their capabilities to new customers. Many agencies do something similar when they agree to write only one line of business for a customer. This can be a great strategy, but only if you can track progress. In a year or two, your tracking should show you’ve picked up additional lines of business to make the account profitable. (Credit: Blue Planet Studio/Adobe Stock)

I recently met with an agency principal who, after two years in business, had experienced impressive sales growth, built a solid team of professionals, enjoyed strong relationships with his insurance companies due to low loss ratios, but had not yet found a sense of satisfaction, only frustration. The problem? He wasn’t making any money despite all his “success.”

His story serves as a great reminder that a business’ primary purpose is to generate profits and equity for its owners. Generating profits and equity requires a business-like approach to managing the enterprise.

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