Running your own business is hard work – it requires dedication, persistence, and often blood, sweat and tears.
Having invested our heart and soul into it, we can have a tendency to see our business through slightly rose-tinted glasses. We like to think that it’s a great business and that, given all our hard work, it must be the best that it can be.
The reality may be a little different, and it’s important that we’re prepared to take a long, hard look at the facts if we really want it to flourish and prosper.
One great way to evaluate the performance of your business is to compare it with others in your industry. We often do this in a subjective manner but far less people do this in an objective manner. Maybe this is because obtaining objective data about our competitors can be difficult or expensive to do. Or maybe we’re afraid to face the facts.
Whatever the case, there’s now no excuse! The Australian Taxation Office has made available Small business benchmark data from a wide range of industries on their web site. It’s not complex or detailed, but it very quickly helps you to identify whether you’re running your business on par with the rest of your industry. The key figures it provides are the industry average Cost of Goods as a percentage of turnover, and also Labour Costs as a percentage of turnover, and breaks these figures down according to the size/scale of business.
It only takes a few minutes to check what your industry benchmarks are, and then you only need to compare your own figures to identify whether you’re performing above or below average.