Every time I pass a store I wonder “How do they stay in business? How do they make money?” With so many businesses so empty so often you just have to wonder how it all works out. What are their keys to profit? How do they make rent? How do they pay their people? How do they cover their bills? How do the owners take something home at the end of the day?
With the help of Edward Glaeser, a pioneering urban economist at Harvard, New York Magazine profiles a diverse range of New York businesses including a private school, a yoga studio, a drug dealer, a sex shop, a cab driver, a copy shop, a 4-star restaurant, and Goldman Sachs.
Best way to make money as a drug dealer: Sell to many users in small quantities. “It’s like taking a pound of coffee and selling one grain at a time,” says Nick. “If you sell by scoops, you’ll make a couple thousand dollars, but if you break it down into quarter grams and work for a few days, you’ll make tens of thousands.”
Most profitable fares for a cab driver: Low-traffic city trips: “Every time somebody gets out, someone gets in, and I get my $2.50.” Midday airport runs: “At 3 p.m., there’s no traffic, and so many planes are coming in that you get $90 plus tips.”
Most profitable for a copy shop: Restaurant flyers. Those annoying restaurant flyers fuel the photocopy industry. Local restaurants order 1,000 new flyers every three days.
Least profitable diner customers: The elderly. They have a tendency to return food.
It’s enlightening. [via kottke]