Survey Says: Many Firms Struggle To Hit Targets As Profits, On Average, Dip This Year

While 2012’s headlines were cautiously optimistic about the potential momentum of the flickering lights of growth that were being seen more frequently around the country, results from this year’s Annual IPA Survey and Analysis of Firms reflects a continued mixed tapestry.

 A small number of firms have made significant revenue and net income progress, while many firms of all sizes saw profits remain stagnant or decline slightly this year. Across almost every revenue band, average profitability (net income as a percent of net revenue) drifted downward from last year, as is reported in more detail in the IPA National Benchmarking Report.

 Overall, firms last year were optimistic about signs of growth, and many leaders believe that their investments in new hires and technology made last year just haven’t paid off yet. Another possibility is that it’s just more difficult than in the past to hit profitability targets. It is critical to remember that although the averages have drifted downward, plenty of firms land on either side of that number, and big strides are still being made by a number of firms.