How does your business compare

Small business benchmarks are a guide to help businesses compare their performance against similar businesses in an industry. The ATO has updated their small business benchmarks and this Best practiceis a helpful resource that you can use to gain useful insights on how well your business is performing in comparison to the industry average.

Benchmarks can help you by:
Рcomparing how your business is performing against similar businesses in the industry
– identifying where adjustments can be made to costs and expenses to improve business performance
– acting as a guide for new businesses when they are starting up.

Types of benchmarks

The two types of benchmarks that have been developed for the small business sector are:
– performance benchmarks
– input benchmarks.

Performance benchmarks

Performance benchmarks provide financial ratios for your industry to help you work out:
– how you compare to other businesses in your industry
– whether you might be able to make improvements in your business.

Input benchmarks

Input benchmarks show an expected range of income for tradespeople based on the labour and materials they use to undertake domestic projects. They are developed using information provided to us by industry participants and trade associations.

Input benchmarks may help you to:
– compare your business to your industry’s benchmark range
– estimate your turnover based on the labour and materials used.
– check that your records accurately reflect your income