#general-chat
Thread
For the 7 figure brand owners... what is your total profit margins on the whole brand after all expenses (including team, softwares, COGs etc)? To simplify... for everyone $1 million in revenue, what do you expect your company to profit?
Hey Luka, this question can be super subjective according to the business business model. Can you tell me a bit your sector, do you produce internally, do you have an internal team or do you outsource a lot for marketing and operations?
Varies by a lot of factors, but I would say: (-100k and under is u
@Luka Varies by a lot of factors (sector, growth targets, balance sheet influences, etc.), but ballpark, here are my thoughts for a $1mm/yr revs biz.
• Profits of $100k or more (strong, should consider investing in faster growth. common for steady businesses that want to flow cash to ownership)
• Profits of $50k to $100k (good target if growing)
• Profits of $0k to $50k (very common, plenty of room for improvement - most of our clients are here when we meet them)
• Losses of $0 to $100k (should trim overhead and evaluate product margins and other contributors to gross margin. acceptable only if scaling VERY quickly, especially in subscription businesses. cash likely very tight without significant capital behind the biz).
• Losing $100k or more per year (unacceptable under nearly any circumstance, even in very high growth, in my opinion in a D2C business. If it's tech or another business with very high gross margin, then perhaps you could make an argument for it that you'll grow fast then slash overhead later)
@Paolo C. we have a internal team. CS, Video editors, strategist etc. We barely outsource anything except for the shooting (which is also guided by our creative strategist). This brand started late last year and we do a low multi 7-figure a year in sales and are now experiencing good growth so we're looking for good benchmarks to follow.
@Steve Bazant Thank you for the insight, Good to know, we're above those benchmarks and in a healthy range then