{
  "@context": "https://schema.org",
  "@type": "Dataset",
  "name": "How much profit does a small business make?",
  "description": "The typical US small business runs a 7–15% net margin, so a $500,000-revenue business nets $35,000–$75,000 before owner compensation adjustments. Professional services clear 15–30%; restaurants and grocery operate on 3–8%; software and licensing businesses can exceed 40%.",
  "url": "https://www.revenuelab.fyi/answers/how-much-profit-does-a-small-business-make",
  "dateModified": "2026-08-12",
  "creator": {
    "@type": "Organization",
    "name": "RevenueLab",
    "url": "https://www.revenuelab.fyi"
  },
  "license": "https://creativecommons.org/licenses/by/4.0/",
  "keywords": [
    "Profit Margin Calculator",
    "Business Acquisition Valuation Calculator",
    "Break-Even Calculator"
  ],
  "distribution": {
    "@type": "DataDownload",
    "contentUrl": "https://www.revenuelab.fyi/api/public/page.json?path=answers%2Fhow-much-profit-does-a-small-business-make",
    "encodingFormat": "application/json"
  },
  "json": {
    "type": "answer",
    "question": "How much profit does a small business make?",
    "shortAnswer": "The typical US small business runs a 7–15% net margin, so a $500,000-revenue business nets $35,000–$75,000 before owner compensation adjustments. Professional services clear 15–30%; restaurants and grocery operate on 3–8%; software and licensing businesses can exceed 40%.",
    "tableTitle": "Net margin by small-business sector (2026)",
    "columns": [
      "Sector",
      "Net margin",
      "On $500K revenue"
    ],
    "rows": [
      {
        "label": "Professional services",
        "value": "15–30%",
        "note": "$75K–$150K"
      },
      {
        "label": "Trades / contracting",
        "value": "8–18%",
        "note": "$40K–$90K"
      },
      {
        "label": "Ecommerce",
        "value": "5–12%",
        "note": "$25K–$60K"
      },
      {
        "label": "Restaurants",
        "value": "3–8%",
        "note": "$15K–$40K"
      },
      {
        "label": "Retail storefront",
        "value": "3–9%",
        "note": "$15K–$45K"
      },
      {
        "label": "Software / digital products",
        "value": "25–55%",
        "note": "$125K–$275K"
      }
    ],
    "context": "Net margin comparisons break down when owner pay is handled differently across businesses. Many small companies run the owner's compensation through profit, which inflates margin, while others pay a full salary first and report a thinner number for the same underlying economics. The right normalisation is seller's discretionary earnings: net profit plus owner salary plus one-off and personal expenses. That is the figure buyers, lenders and valuation multiples actually use, and it is the only way to compare a solo consultancy against a ten-person shop.",
    "methodology": "Sector margin bands from aggregated small-business financial benchmarks, normalised to seller's discretionary earnings and cross-checked against the RevenueLab profit margin and valuation calculators.",
    "dateModified": "2026-08-12",
    "relatedCalculators": [
      {
        "label": "Profit Margin Calculator",
        "to": "/profit-margin-calculator"
      },
      {
        "label": "Business Acquisition Valuation Calculator",
        "to": "/business-acquisition-valuation-calculator"
      },
      {
        "label": "Break-Even Calculator",
        "to": "/break-even-calculator"
      }
    ],
    "relatedReading": []
  }
}