Profitability

“ Whether it's the high wage paid by the Company, the big profits of the business man or the heavier crop of the rancher, it amounts to the same. And yet you would insist that they must not be governed by this desire for gain. So far as I can see, it is this same desire for gain that has driven men into doing every really great thing that has ever been done. Look carefully into every great enterprise that is of value to the world and you will find at the beginning of it someone reaching for a dollar or its equivalent. ”

“ Of the net profits of persons in business, a part, as before observed, may be considered as interest on capital, and of a perpetual character, and the remaining part as remuneration for the skill and labour of superintendence. ”

“ It is for the service of all, though it may be under the direction of one.
Profits belong in three places: they belong to the business—to keep it steady, progressive, and sound. They belong to the men who helped produce them. And they belong also, in part, to the public. ”

“ Before there can be any development of business there must be promise of a profit. If the business is more risky than the average there must be promise of a profit higher than the average. Take away this incentive and business stagnates. ”

“ In this manner you may not only make a profitable investment, but you are given an opportunity to become yourselves employers of labor and to share in the profits of the great enterprise which you have helped to build up. ”

“ The fortunate few, who do combine them, are thus generally able to extract in the form of profits a high price for their services, a price which covers not only the strict reward of risk-bearing, and the necessary remuneration of their own service, but a handsome payment for the special qualities and advantages which have been indicated. Profits, moreover, may vary between one industry and another, not only in accordance with the real risk which is entailed, but with the degree to which the supply of special knowledge, etc., is scarce or abundant. ”

“ He is paying money away on every side, which he would not do if he did not expect a return, with a profit. By all these operations—by the [Pg 367] work of his horses and his labourers—by the increase in number, and the increase in value of his flocks and herds,—and by the harvest after the seed-time,—new produce is created which produces a return of capital, and ought to produce a profit if that capital is properly expended. The hope of profit sets the capital to work, and the capital sets the labour to work. ”

“ If it is strong and increasing, he will feel sure that the consumers will repay the whole cost of production, interest and capital included, and in addition the legitimate profit attached to the business. ”

“ Meanwhile you, a wealthy merchant, are daily rolling up an enormous fortune by doing business upon the same principle which you condemn in the wheelwright, and nobody finds fault. At every scarcity in the market you immediately raise the price of every article you hold. It is your business to take advantage of the necessities of those with whom you deal, by selling [138] to them according to the value to them, and not according to the cost to you. ”

“ Profit, another form of interest, is an expensive process of your money system. The Romans had a saying, Caveat Emptor, 'Let the buyer beware.' History shows that your industrial, and commercial business, and services have always been based on hard bargaining. The desire for more money gain was and is so deeply impregnated in you that it has blunted and broken down your ethical standards. You have always tried to get the most gain for the least value. ”

“ By his knowledge of the right times and best modes of purchasing, by his enterprise and sagacity in maintaining intercourse with and between distant markets, and by his outlay of capital and skill as a carrier of commodities from the place of their production to the place where they are needed for use, he cheapens the goods that pass through his hands by a greater amount than the toll he levies upon them, which—however large—is his rightful due. ”

“ In no case, we find, is the mere money which passes from one person to another, the fundamental matter in any economical phenomenon. If we look more narrowly into the operations of the producer, we shall perceive that the money he obtains for his commodity is not the cause of his having a profit, but only the mode in which his profit is paid to him.
The cause of profit is, that labour produces more than is required for its support. ”

“ We have, from a thorough study of economics, decided to enter upon this business. It has many merits, chief among which may be noted that we can indulge in large and lucrative operations without capital. ”

“ To inquire searchingly into every nook and cranny of the business, to construct, as it were, for each part a separate balance-sheet of profit and loss, to expand in those directions where further development promises good results, and to curtail activity where loss is already evident, is the very essence of good management. Here, it will be observed, we are using language very similar to that in which we described the principles which govern a business man's expenditure. ”

“ Why should there be any profits at all, I should like to know. And if profits there must be, well then, the profit grabber isn’t going to get ten times as much as the wage-earner, just because he had a few screwing forefathers. ”

“ There is little need to dwell on the profit that must accrue to such a company as the one now projected. All commercial enterprises that have hitherto existed, or even any combination of them, cannot be compared for wealth-producing to the scheme we have now in hand. ”

“ We must examine the nature of Capital with care, and follow its varied forms without confusion, because it is the only other factor besides labor in the production of commodities, that has to be paid for out of their sale. ”

“ I have not written to establish any favorite theory, but simply to inculcate truth, and to aid in developing a most important branch of American industry, which, either directly or indirectly, involves the investment of a vast amount of capital, the aggregate profits of which depend so largely on your judgment and skill. ”

“ Returning to the question of interest on actual capital,—i.e., the excess of value produced over the cost of production,—the question as to what determines the value of a product leads to the assertion that capital-profit must be due to an advantage which the producer possesses over the marginal producer. ”

“ I soon became expert at the business, and, in obedience to my father’s injunctions, drove it on with spirit while I was at it. The making of money I found far more profitable than the making of purses. ”

“ Profit directs production; profit is a source of income for shareholders and, of course, for owners of factories, etc.; more-than-one-party system - Great Britain, U.S.A. and many other states about 1900 represent this type. ”

“ The greater part of the profitable investment of capital, in the present day, is in operations of this kind, in which the public is persuaded to buy something of no use to it, on production, or sale, of which, the capitalist may charge per-centage ”

“ If you make what they need, and sell it at a price which makes possession a help and not a hardship, then you will do business as long as there is business to do. People buy what helps them just as naturally as they drink water. ”

“ The commercial and the lucrative arts may continue to prosper, but they gain an ascendant at the expense of other pursuits. The desire of profit stifles the love of perfection. Interest cools the imagination, and hardens the heart; and, recommending employments in proportion as they are lucrative, and certain in their gains, it drives ingenuity, and ambition itself, to the counter and the workshop. ”

“ What do we say, in fact?
To determine value,—in other words, to organize within itself the production and distribution of wealth,—society proceeds exactly as the mind does in the generation of concepts. ”

“ But you cannot get something for nothing. You must pay for everything worth having. You must pay the price set upon it, and in the coin of the realm.
The coin of the realm is industry—just that. Industry and only industry. Nothing but industry. ”

“ The business enterprise then directs its attention to profits, because, from mere economic necessity, profits are the criterion of the true success of the enterprise, that is, its serviceability to mankind. Here we distinguish between the shortsighted man, who aims at immediate returns, and the farsighted man, whose eye is fixed on the future, who verily desires the profits, but desires them in the long run. ”

“ At present you must note that all the amazing machinery which we have invented has served only to increase the amount of profit-bearing wares; in other words, to increase the amount of profit pouched by individuals for their own advantage, part of which profit they use as capital for the production of more profit, with ever the same waste attached to it ”

“ The Importance of the Need of Enlarging a Business.—There is a special reason why legitimate business profits are morally certain to be to a large extent laid aside for investment. The man would say that he "needs them in his business." ”

“ By profits, must of course be understood the rate of profit; for a lower rate of profit on a larger capital may yield a larger gross profit, considered absolutely, though a smaller in proportion to the entire produce. ”

“ The remaining portion of value, embodied in the total use-form of fixed capital, is of decisive importance for production as a labour process, but does not exist for the annual reproduction of society as a process of value-formation. ”

“ It will come out in greater fulness and force when, having taken into consideration the theory of Value and Price, we shall be enabled to exhibit the law of profits in the concrete—in the complex entanglement of circumstances in which it actually works. ”

“ If the object be to do as much good as possible, that object will be attained by doing a large business at small profits rather than a small business at higher prices; and that is also precisely the way by which, within certain limits, the best financial results may be attained. ”

“ It is common to speak of two kinds of revenue. That which we have mentioned,—the profits of capital,—is called neat revenue; while the name of gross revenue is given to the whole return made to the capitalist; that is, his reproduced capital and his profits together make his gross revenue, and his profits alone make his neat revenue. ”

“ A certain percentage of the earnings of the business would be allotted to capital, and to cover depreciation and development, over and above which the employee-partners would participate in all profits. ”

“ Every one knows that as applied to them it has not even the semblance of plausibility; that the wealth of a producer does in a great measure depend upon the number of his customers, and that in general every additional purchaser does really add to his profits. ”

“ Speculation for economic theory is a purely commercial phenomenon, a hazarding of capital on the supposition that desires will be found ready and waiting for the commodity produced—with a sufficient offering of purchasing power to afford a profit. ”

“ The distribution of provisions, money, and merchandise in just proportions, according to times and places, is the true secret of finance and the source of wealth, provided those who administer it have foresight enough to suffer a present apparent loss, in order really to obtain immense profits in the future. ”

“ Our business succeeded beyond our expectations; and in order to supply the increasing demands for our products, we found it necessary to employ additional force and capital, build new forges, and otherwise enlarge the sphere of our operations. ”

“ There is, further, a large field of business, employing much capital goods and many technological processes, whose profits come from products in which serviceability and disserviceability are mingled with waste in the most varying proportions. ”

“ If one purchaser values an article more highly than another, by what principle will he be prevented from offering a higher price? How is it possible to measure the relative painfulness or repugnance of labour? What allowance is to be made for superior skill or natural capacity? ”

“ The economic interest, as a function of intelligence, finds its proper expression in a valuation set upon one thing in terms of another—a valuation that is either a step in a settled plan of spending and consumption or marks the passing of an old plan and our embarkation on a new. From such a view it must follow that the economic betterment of an individual or a society can consist neither in the accumulation of material wealth alone nor in a more diversified technical knowledge and skill. ”

“ Then what you say comes to this: that upon your hosiery goods you make no profit at all?-Not when they are once sold; that is to say, when they are once bought, the profit lies in the profit we have upon the goods. That is the only profit we have in the matter. ”

“ Second, other things being equal, profits varied directly as the complexity of the business organization. By this proposition is meant, for example, that a farmer who paid money rent, used borrowed capital, and employed hired labourers, made a higher percentage of profits than a farmer of whom any one of these suppositions did not hold true. If, as has been argued, the increase of profits was made at the expense of laborers, landlords, and capitalists, it follows that that entrepreneur fared best whose contracts enabled him to exploit the largest number of these other persons. ”