A Benchmark Study is a financial "snapshot" of an industry group that allows individual business owners to compare their operations to others of similar size and type. In
practical terms, it helps participants answer questions such as:
"Exactly how
much more money could I be making if I managed my cost of goods as
efficiently as my peers? How does my operating profit compare to
others in my type of operation?"
"What specific
action plans can I put in place at my company to get my numbers in
line with the profit leaders?"
"How do my cash
flow and liquidity levels compare to others? Exactly how much more
cash would I have in the bank if I achieved improvements in this
area?"
"Am I making the
most efficient use of my assets and equipment?"
Benchmark Study reports contain performance ratios. Ratios allow your
numbers to focus on the financial relationships in a business, rather than just on absolute numbers, such as annual sales. BRS uses median ratios that show the half-way point in the data groupings. This is important because medians can prevent "skewing" of data by a few unusual respondents. The reports also contain statements in common-sized format. For example on a common-sized profit and loss statement, revenue and expense items are shown as percentages of sales. Percentages, like all ratios, show numbers in relation to each other.
The entire group
is then sorted by key characteristics, such as sales levels, age
of company and profitability. Sorting allows group members to
compare "like to like." In other words, it can indicate
how a company operating at a certain level of sales is performing
compared to others in its sales range. It also can allow us to
determine how, and if, the age of company affects its
profitability. The high profit
group is closely analyzed as it can provide important clues as to
how certain companies are able to generate higher levels of
profits than others. This analysis is presented in "plain English" style that allows your members to understand and take immediate action.
Many find it a critical document that they refer to often in their day-to-day planning and management.
In addition, as a management tool, benchmark participants have used their individual company reports to negotiate lower interest rates from their bankers.
How Long Does It Take?
Generally, it takes about 6-8 months to produce a benchmark study, from initial data collection to final report. A lot depends on how quickly we can collect financial statement data from your membership.
We Already Collect Sales and Expense Data from our members. Isn't that the same?
Without data that ties in information from both the profit & loss and balance sheet statements of your members, you miss the key indicators in crucial areas such as working capital and asset management.
We've Tried Before to Collect Financial Data from our members and it didn't work.
Confidentiality is a big concern in all the groups we work with. As an independent third party, we can offer the
commitment of complete confidentiality to your members. We will not share individual company data with any other organization, including the sponsoring client, unless we have specific permission from the participating company.
That commitment - along with the credibility we've established delivering
financial education within a network - make a huge difference in participation levels. We can get your members to "play" in the process.
Want More Information? Contact us for further details on fees and timelines.
Business Resource Services,
Inc. | 200 First Avenue West | Suite 301 | Seattle WA 98119
Phone 206.284.5102 | Toll Free 800.488.3520 | Fax 206.282.4092 | E-mail brs@brs-seattle.com
owners to compare their operations to others of similar size and type. In
practical terms, it helps participants answer questions such as:
