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Cyclicality of Industry Profitability
The fluctuations in profitability within an industry over time.
Implications
The tendency of an industry�s profitability to fluctuate in cycles, often influenced by economic conditions, consumer demand, and other external factors, important for strategic planning and risk management.
Example
Example: A construction company analyzes the cyclicality of industry profitability to prepare for downturns during economic recessions, adjusting its investment and hiring strategies accordingly.
Related Terms
Different from consistent profitability, which is steady over time, cyclicality involves periods of growth and decline that can significantly impact business operations and planning.
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