One way to analyse a business performance is through “Benchmarking”. Benchmarking activity is comparing your business performance against other businesses in the same industry – so you’re comparing an apple with other apples and NOT with oranges.
In the past, Benchmarking was an expensive exercise. As you needed to pay a substantial price for someone to gather the information for you. Therefore, it was run mostly by big companies only. Thanks to modern technology, today you can get simple Benchmarking data for free. While basic, this data still consists of key variables like cost of goods sold, wages & remuneration, rental expenses, and net profit of other businesses in that particular industry.
Here in Australia, pretty much all businesses need to lodge activity statements and tax returns. The Australian Taxation Office (ATO) has all the information for benchmarking analysis, and every year it helps us with Benchmarking our performance against others in the same industry. Apart from being free of charge, the other advantage of using this information is it classifies its Benchmarking into 3 categories: Small, medium and large businesses. So you can review your business performance accordingly.
To see your industry Benchmark, please go to Business Benchmarking If you would like assistance with Benchmarking your business, or would like to know what the data means for you and your business please contact us.
For an appointment, or a confidential discussion of your needs, please contact our Tax Accountants today, or call 1300 627 829.
