If you’re looking to start a profitable business idea, it might be time to brush up on your number crunching skills.
Over the past 12 months, accounting services topped the list of the 15 largest sectors in the small business sector by net profit margin, according to financial information firm Sageworks. The list was compiled from a database of more than 1,000 financial reports from private companies with annual revenues of less than $10 million.
According to Sageworks data, accounting tops the list for generating the highest profit margins, but the rest of the list is dominated by service-oriented companies in healthcare and real estate.
Sageworks analyst Jenna Weaver points out that many of these service sectors consistently rank high on lists of “most profitable” sectors. “Service-based industries often have very healthy bottom lines,” she says. “Their overhead and equipment costs are often relatively low, and much of the time, it doesn’t take a lot of upfront investment to get started.”
Weaver adds: “Often times, in cases like consulting, accounting, and legal services, you can get started right inside of your house, without even worrying about renting a space.”
Check out the 15 industries with the highest net profit margins for the 12 months ending July 31, 2014. For aspiring entrepreneurs, this may be a great place to start when coming up with new business ideas. (Note: Net profit margin excludes taxes and is adjusted to include owner compensation above market salary.)
| Industry | Net Profit Margin |
| Accounting, Tax Preparation, Bookkeeping, and Payroll Services | 20.00% |
| Oil and Gas Extraction | 19.20% |
| Commercial and Industrial Machinery and Equipment Rental and Leasing | 17.70% |
| Legal Services | 16.50% |
| Offices of Real Estate Agents and Brokers | 14.80% |
| Offices of Physicians | 14.80% |
| Offices of Dentists | 14.50% |
| Management of Companies and Enterprises | 14.10% |
| Lessors of Real Estate | 13.60% |
| Offices of Other Health Practitioners | 13.10% |
| Support Activities for Mining | 12.30% |
| Warehousing and Storage | 11.60% |
| Management, Scientific, and Technical Consulting Services | 11.60% |
| Outpatient Care Centers | 11.50% |
| Activities Related to Real Estate | 10.60% |
