For the other industries displayed in the table above that operate on thin profit margins of less than 4%, companies in those industries have to operate until the middle of December (airlines for example at December 18), or even until the last week (department stores), or in the case of grocery stores until the middle of the last week of December. Think about it — a grocery chain like Safeway or Kroger has to operate from January 1 to December 26 until it breaks even for the year, and only then will its sales revenue from the the last 4.4 days starting on December 27 represent the profits for the entire year! And that’s only if everything goes exactly right, and nothing goes wrong — like a sales slump from a recessionary slowdown or from increased competition from a new competitor like Walmart and Target (now in the grocery business); or like an unexpected increase in costs that can’t be passed along in the form of higher prices, etc.
As a percentage of operating costs, profits are often miniscule. Yet they play an outsized moral role in the creation and distribution of goods and services. “Profits motivate people to work hard for themselves and to make life bette for others,” says economist Walter Williams.