Not necessarily. An extremely low profit margin is a sign of a commodities market, where there isn't really a space for innovation. For example a grocery store, so you are competing on very fine details and logistics.
High margin, COULD be inefficiency, but it could just be a technological or innovation advantage.
It seems ride hailing is transitioning into a commodity since innovation has dried up. The one obvious disruption would be self driving cars
Well, at one time, cash registers, packaged food, and stores were all technological innovations. I'm asking whether 'technological or innovation advantage' can be interpreted as a sign of temporary inefficiency that will eventually get ironed out of the system (unless maintained by force, as another commenter mentions.)
I guess in a world without regulations or laws? The entire economy is predicated on patent and copyright law, as western civilization has deemed it beneficial to protect innovation and reward the innovator.
If your potential competition is stymied by huge costs of startup or catchup, or you've got the government (be it national or local) on side to help you maintain a monopoly or cartel (I'm looking your way, numerous US internet service providers...), then your high margin can exist for a very long time. I don't know if I'd like to say "indefinitely" but with the right moats, yeah, maybe indefinitely.
Is a high-margin business a sign of market inefficiency that will eventually be stamped out?