How much profit?

  1. #1
    woodsrider's Avatar
    Join Date
    Sep 04
    Posts
    20,521

    How much profit?

    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 %.
    Advertisement

  2. #2

    Join Date
    May 08
    Posts
    91,216

    As much as they can.

    The only answer IMO.

  3. #3
    woodsrider's Avatar
    Join Date
    Sep 04
    Posts
    20,521

    Quote Originally Posted by Clyde View Post
    As much as they can.
    Man your quick.

  4. #4

    Join Date
    May 08
    Posts
    91,216

    Quote Originally Posted by woodsrider View Post
    Man your quick.
    Is there a different answer ?

  5. #5
    woodsrider's Avatar
    Join Date
    Sep 04
    Posts
    20,521

    Quote Originally Posted by Clyde View Post
    Is there a different answer ?
    No, I mean quick on the trigger. I barely got the thread posted when you replied.

  6. #6

    Join Date
    May 08
    Posts
    91,216

    Quote Originally Posted by woodsrider View Post
    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?

  7. #7
    woodsrider's Avatar
    Join Date
    Sep 04
    Posts
    20,521

    Quote Originally Posted by Clyde View Post
    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.

  8. #8

    Join Date
    May 01
    Location
    City of Beautiful Homes
    Posts
    25,560

    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?

  9. #9
    Colonels_Wear_Blue's Avatar
    Join Date
    Jul 09
    Location
    Colonel Country
    Posts
    45,720

    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%.

  10. #10

    Join Date
    May 08
    Posts
    91,216

    Quote Originally Posted by Colonels_Wear_Blue View Post
    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.

  11. #11
    Colonels_Wear_Blue's Avatar
    Join Date
    Jul 09
    Location
    Colonel Country
    Posts
    45,720

    Quote Originally Posted by Clyde View Post
    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.

  12. #12
    Colonels_Wear_Blue's Avatar
    Join Date
    Jul 09
    Location
    Colonel Country
    Posts
    45,720

    Quote Originally Posted by woodsrider View Post
    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.

  13. #13

    Join Date
    Jul 03
    Location
    kentucky
    Posts
    836

    Quote Originally Posted by Colonels_Wear_Blue View Post
    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

  14. #14
    woodsrider's Avatar
    Join Date
    Sep 04
    Posts
    20,521

    Quote Originally Posted by lynks66 View Post
    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.

  15. #15

    Join Date
    Apr 07
    Location
    Bluegrass Region
    Posts
    10,950

    Quote Originally Posted by Clyde View Post
    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!

Top