Profits (service)

[SoyLeche]

What do you think, in general, is an "ethical" (acceptible, whatever word you want to use) profit margin? (Profit margin is the profit as a % of revenue)

Poll to follow

[Kungfuzed]

Profit margin for what? If you're working on your own selling a service like cleaning houses or mowing lawns it might be over %80 even though you're not getting rich. The profit margin is determined more by supply and demand rather than the seller. Are you talking about a maximum profit margin or minimum? If you're dealing in high volume sales it can be very low. If sales are very slow it will have to be very high.

[SoyLeche]

Originally Posted by Kungfuzed

Profit margin for what? If you're working on your own selling a service like cleaning houses or mowing lawns it might be over %80 even though you're not getting rich. The profit margin is determined more by supply and demand rather than the seller. Are you talking about a maximum profit margin or minimum? If you're dealing in high volume sales it can be very low. If sales are very slow it will have to be very high.

For a major corporation.

[Kungfuzed]

I don't see what profit margin has to do with ethics. There's nothing intrinsically wrong with getting rich.

[SoyLeche]

Originally Posted by Kungfuzed

I don't see what profit margin has to do with ethics. There's nothing intrinsically wrong with getting rich.

Ok, at what level of profit margin would a corporation start being overly "greedy"?

Incidentally, I don't think there is anything wrong with it either. I'm just curious what everyone else thinks. Is it wrong for a corporation to keep 10% of the price you paid for their product as profit? 20%? 50%?

[PolyHedral]

I would say that as much as needed to make a good amount of profit.

(buying a $10 [noun] and selling it for $12 is 20% but still very little profit.)

[SoyLeche]

Originally Posted by PolyHedral

I would say that as much as needed to make a good amount of profit.

(buying a $10 [noun] and selling it for $12 is 20% but still very little profit.)

Define "a good amount of profit"

[Terrywoodenpic]

I do not accept your definition of profit.
If you consider profit to be what is left over after every thing has been paid for; yours and every one else's wages paid; interest paid on loans and dividends paid; Taxes and fees paid.
Then view that remainder as a percentage of those costs; then not many businesses achieve more than a 10% profit.
on a multi billion dollar business that can be a lot of money indeed.
There are some businesses like Google who have to keep buying other businesses to keep their margin in check, but as they are a basically very low cost business their net profit is astronomical.
though the profit on each transaction is minute( it is based on clicks) they simply have difficulty not making money.

I do not think that there can be an Ethical limit to profit...

However a business can be either ethical or not,
We all have the option to deal with who so ever we chose.
This way we decide on the level of profit we are willing to subscribe.

[Kungfuzed]

I think it depends on the product. If it's something necessary for survival and a company has a monopoly and is making it a hardship for people by sending prices through the roof then it would be unethical. But if a new gaming system launches on Christmas Eve and is charging six hundred dollars for something that will only be selling for two hundred dollars a year from now, who cares?