2 ms·
It's not make $1mm, it's sell $1mm. At a 3-5% net profit, that's $30-50k/year before taxes, or so small you can't even hire a first employee yet. And that's the
by dangrossman 14y ago
It's not make $1mm, it's sell $1mm. At a 3-5% net profit, that's $30-50k/year before taxes, or so small you can't even hire a first employee yet. And that's the category the online store for my father's retail shop is in.
- mikeyouse 14y agoI'm genuinely curious which type of online store earns less than 5% net but generates $1mm in revenue.
- dangrossman 14y agoI'm not comfortable giving out too many details about his store without permission, but here's a list of 83 industries that average less than 5% net margin: http://biz.yahoo.com/p/sum_qpmu.html http://biz.yahoo.com/p/sum_qpmu.html
- dragonwriter 14y ago> It's not make $1mm, it's sell $1mm. Its not either. Its have over $1 million in remote sales in the prior year. > At a 3-5% net profit, that's $30-50k/year before taxes, or so small you can't even hire a first employee yet. Well, since net profit is after operating expenses (including labor costs), that's only "so small you can't even hire a first employee yet" if you expect the net value produced by that employee to be negative 30-50k per annum, in which case you it would be economically irrational to hire the employee even if you could afford it while remaining profitable. (While the numbers change, the general observation is true for any non-negative net profit amount: if you expect a positive return from an employee, you can "afford" to hire them -- and expect to be profitable afterwards -- anytime you have either a non-negative net profit, or a negative net profit that is smaller than the expected net value provided by the employee.)