There are two types of cycles. The first is industry related. The second is broader in scope and is economy wide. A small business owner must understand both in order to evaluate and exercise the assets of the business appropriately. For more information read: Economic Cycles.
Profit standards for residential contractors vary depending on the type of contractor. In general, the net profit standard for contractors in the upper tier of performance range from 5.8% to as high as 9.6% of sales.
One of the primary purposes of a profit is to provide funds during downturns in the business cycle. Often referred to as the economic cycle, there are two types of cycles. The first is industry related. The second is broader in scope and is economy wide.
