What Do People Misunderstand About Service Companies?

There’s a difference between companies that provide services versus products. 

If you're starting a business and have an idea for a product, typically you’ll spend a lot before you make significant profit. If you can do that over the long haul, you’ll make your money back and then some. 

On the other hand, most services companies are pretty constrained about long-term profit potential. You're typically selling a time increment for consulting services or whatever it is you're delivering. 

That time increment has heavy expenses. Our staff’s salary and benefits are ~90% of our costs. You can still run a healthy long-term business, but it's not gonna be as profitable.