Simple question. How much profit do you think is fair for a company to make? And I am not talking about $, I am talking about %.

As much as they can.

 

The only answer IMO.

As much as they can.

 

Man your quick.

Man your quick.

 

Is there a different answer ?

Is there a different answer ?

 

No, I mean quick on the trigger. I barely got the thread posted when you replied.

No, I mean quick on the trigger. I barely got the thread posted when you replied.

 

Gotcha.

 

Again, is there a better answer than "as much as they can" and , if so, who gets to play profit czar?

Gotcha.

 

Again, is there a better answer than "as much as they can" and , if so, who gets to play profit czar?

 

As far as I am concerned there isn't.

Great question! I will admit I don't know the answer even though I tend to lean towards Clyde's. Should it matter what industry/product the company provides? Should it matter how much competition exists for the product?

I also tend to lean towards Clyde's answer...but I can tell you from experience in the construction industry, if you're currently bidding anything with profit margins any higher than 4%, you ain't gettin' the job. Public work is generally going somewhere in the 2 1/2 - 3% range, and private work is going at 3 - 4%.

I also tend to lean towards Clyde's answer...but I can tell you from experience in the construction industry, if you're currently bidding anything with profit margins any higher than 4%, you ain't gettin' the job. Public work is generally going somewhere in the 2 1/2 - 3% range, and private work is going at 3 - 4%.

 

Your example is why I lean towards "no limit." Your market and your skills and your ability to run your business will ultimately determine your profit. Software companies look at a much higher gross and net margin. Different product. Different expenses. Oil will be very profitable because of demand around the world vs supply.

Your example is why I lean towards "no limit." Your market and your skills and your ability to run your business will ultimately determine your profit. Software companies look at a much higher gross and net margin. Different product. Different expenses. Oil will be very profitable because of demand around the world vs supply.

 

Dead on.

Simple question. How much profit do you think is fair for a company to make? And I am not talking about $, I am talking about %.

 

Now if you're asking what I think a "fair" amount of profit is in terms of "How much profit can you make before you get to the point that you're taking advantage of someone?", I would say that there's a certain margin of ambivalence inherent to the answer. Still I think that in general, once you get up around or above 20% profit - PURE PROFIT - on pretty much any product or service that you're providing, in all likelihood you've got some larceny in your heart.

Now if you're asking what I think a "fair" amount of profit is in terms of "How much profit can you make before you get to the point that you're taking advantage of someone?", I would say that there's a certain margin of ambivalence inherent to the answer. Still I think that in general, once you get up around or above 20% profit - PURE PROFIT - on pretty much any product or service that you're providing, in all likelihood you've got some larceny in your heart.

 

I think that would depend largely on what type of business you are running. I can think of a couple examples where 20% profit would not seem that great. JMO

I think that would depend largely on what type of business you are running. I can think of a couple examples where 20% profit would not seem that great. JMO

 

Please keep in mind I am talking about net operating result. Not just gross margin.

As much as they can.

 

The only answer IMO.

 

I am on the record as completely agreeing with Clyde.

 

I did not realize you were an Adam Smith guy. You a have been holding out!