2008-03-28 09:26:44台北光點
The Most and Least Profitable Businesses To Start (2)
■ No. 1: Accounting Services
Average Pretax Margin: 25%
This industry includes services like bookkeeping, designing accounting systems, payroll billing and preparing financial statements and tax returns. A big yawn--until you see the profits start to pile up. Three reasons: pricing power (everybody needs accountants, no matter how the economy is doing), low overhead and marketing scale, thanks to plenty of repeat clients.
■ No. 2: Legal Services
Average Pretax Margin: 21. 6%
Lawyers enjoy healthy economics for many of the same reasons their bean-counting brethren do. Overhead is relatively low (a secretary or two, an office lease, some computers and filing cabinets, and a decent expense account). Business tends to come through referrals, keeping marketing costs down, and repeat business is high, thanks to perceived ”switching costs” of trading one counselor for another.
■ No. 3: Dental Services
Average Pretax Margin: 20.9%
Good teeth make for a bright smile--and a fat bottom line. A big reason: operating scale. Dentists can handle several patients at once--depending on the number of ”chairs” in the office, dentists can run through multiple patients in one hour. Some of the equipment is expensive, but hygienists don’t cost much to employ. Better yet, a lot of customers pay out of pocket. That gives dentists more pricing power relative to other medical providers, who usually have to deal with heavy-handed insurance providers.
■ No. 4: Specialized Design Services
Average Pretax Margin: 17.6%
This hodgepodge includes interior designers, industrial designers (not architects) and graphic designers. Efficiencies derived from technology, such as computer aided design software, have been a boon to these businesses. Meanwhile, design firms can charge a good buck for their talent.
■ No. 5: ”Other” Health Practitioners
Average Pretax Margin: 17.5%
Chiropractors, optometrists, podiatrists, physical therapists, speech therapists and mental health professionals know that it pays to specialize. These health practitioners often have more pricing power than general physicians, as many are able to circumvent the large health insurers and health maintenance organizations skilled at taking their pounds of flesh.
■ No. 6: Outpatient Care Centers
Average Pretax Margin: 16.9%
Spas, family planning centers, outpatient mental health centers, rehab centers, HMO medical centers, kidney dialysis centers and freestanding surgical and emergency centers fall under this broad category. Outpatient care is catching on: As technology improves, medical professionals are performing more procedures in these facilities. While outpatient care centers have plenty of overhead, they stack up well against inpatient-care competitors. They also can often avoid dealing with managed-care providers, though more medical plans are seeking them out to control costs.
■ No. 7: Insurance Brokers
Average Pretax Margin: 15.9%
Included here are insurance agents and those that provide other services, like claims adjustments. Successful agents enjoy annuity-style profit streams: They nab an up-front commission upon selling a policy, as well as fees each year that the policy stays in place. Additional revenues with little additional expense--smart formula.
■ No. 8: Physicians’ Offices
Average Pretax Margin: 15.8%
Of course doctors turn a decent profit--why else would they slog through eight years of medical school and a tortuous residency? And no matter what the economy is doing, there are always sick people to treat. Still, general docs have steadily lost pricing power at the hands of large insurance providers.
■ No. 9: Medical And Diagnostic Labs
Average Pretax Margin: 15.3%
Small fry may have difficulty raising the scratch to buy expensive equipment; once it’s installed, though, the economics of scale start to kick in. Depending on the type of lab, the marginal cost of doing ”one more” test--thanks to typically lean staffing--can be very small.
■ No. 10: Depository Credit Intermediation
Average Pretax Margin: 13.6%
This group includes small banks, credit unions (lenders with cooperative ownership structures, such as the General Motors Credit Union) and other institutions that take deposits. On average, for every dollar of revenue they bring in, just 48 cents goes to cover overhead. While commercial lending has dried up in recent months, community banks have managed to weather the storm thus far--but who knows for how long?
Average Pretax Margin: 25%
This industry includes services like bookkeeping, designing accounting systems, payroll billing and preparing financial statements and tax returns. A big yawn--until you see the profits start to pile up. Three reasons: pricing power (everybody needs accountants, no matter how the economy is doing), low overhead and marketing scale, thanks to plenty of repeat clients.
■ No. 2: Legal Services
Average Pretax Margin: 21. 6%
Lawyers enjoy healthy economics for many of the same reasons their bean-counting brethren do. Overhead is relatively low (a secretary or two, an office lease, some computers and filing cabinets, and a decent expense account). Business tends to come through referrals, keeping marketing costs down, and repeat business is high, thanks to perceived ”switching costs” of trading one counselor for another.
■ No. 3: Dental Services
Average Pretax Margin: 20.9%
Good teeth make for a bright smile--and a fat bottom line. A big reason: operating scale. Dentists can handle several patients at once--depending on the number of ”chairs” in the office, dentists can run through multiple patients in one hour. Some of the equipment is expensive, but hygienists don’t cost much to employ. Better yet, a lot of customers pay out of pocket. That gives dentists more pricing power relative to other medical providers, who usually have to deal with heavy-handed insurance providers.
■ No. 4: Specialized Design Services
Average Pretax Margin: 17.6%
This hodgepodge includes interior designers, industrial designers (not architects) and graphic designers. Efficiencies derived from technology, such as computer aided design software, have been a boon to these businesses. Meanwhile, design firms can charge a good buck for their talent.
■ No. 5: ”Other” Health Practitioners
Average Pretax Margin: 17.5%
Chiropractors, optometrists, podiatrists, physical therapists, speech therapists and mental health professionals know that it pays to specialize. These health practitioners often have more pricing power than general physicians, as many are able to circumvent the large health insurers and health maintenance organizations skilled at taking their pounds of flesh.
■ No. 6: Outpatient Care Centers
Average Pretax Margin: 16.9%
Spas, family planning centers, outpatient mental health centers, rehab centers, HMO medical centers, kidney dialysis centers and freestanding surgical and emergency centers fall under this broad category. Outpatient care is catching on: As technology improves, medical professionals are performing more procedures in these facilities. While outpatient care centers have plenty of overhead, they stack up well against inpatient-care competitors. They also can often avoid dealing with managed-care providers, though more medical plans are seeking them out to control costs.
■ No. 7: Insurance Brokers
Average Pretax Margin: 15.9%
Included here are insurance agents and those that provide other services, like claims adjustments. Successful agents enjoy annuity-style profit streams: They nab an up-front commission upon selling a policy, as well as fees each year that the policy stays in place. Additional revenues with little additional expense--smart formula.
■ No. 8: Physicians’ Offices
Average Pretax Margin: 15.8%
Of course doctors turn a decent profit--why else would they slog through eight years of medical school and a tortuous residency? And no matter what the economy is doing, there are always sick people to treat. Still, general docs have steadily lost pricing power at the hands of large insurance providers.
■ No. 9: Medical And Diagnostic Labs
Average Pretax Margin: 15.3%
Small fry may have difficulty raising the scratch to buy expensive equipment; once it’s installed, though, the economics of scale start to kick in. Depending on the type of lab, the marginal cost of doing ”one more” test--thanks to typically lean staffing--can be very small.
■ No. 10: Depository Credit Intermediation
Average Pretax Margin: 13.6%
This group includes small banks, credit unions (lenders with cooperative ownership structures, such as the General Motors Credit Union) and other institutions that take deposits. On average, for every dollar of revenue they bring in, just 48 cents goes to cover overhead. While commercial lending has dried up in recent months, community banks have managed to weather the storm thus far--but who knows for how long?