http://www.kenniffonline.com/profits-clothing/
What is the average profit margin for a small business such as a small clothing store or boutique?
I’m doing a business project for my Advanced Economics class and I have to calculate the Break Even Analysis. In order to do this, however, I need to figure out the average profit margin for a small business. An answer would be greatly appreciated. Thank you!
For clothing stores and businesses, initially the profit margin is very thin. A high amount don’t even cover the cost/loss margin until a while down the road and with a lot of advertisement.
So initially, for like 6 months to a year, there could be no profit. For boutique it can depend on the geography of the store. Is it located in a city area where people have high interest in beauty. L.A. would be a prime candidate for boutiques.
Also, the type of clothing and make-up the store sells is important also. A preppy store would not make a dime from the punk generation and a punk store like Hot Topic wouldn’t make much from people who normally go to Hollister.
Once everything is rolling and they have regular customers, I would say a Clothing Store for a small business would be $3,000 – $10,000 per month.
So it would be very hard to give you a precise number with so many variables. Maybe if you write about the variables that would be involved, your teacher might be surprised and give you a good mark.
Hope I helped,
Jason H.
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