What is a Benchmark Study?
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, a Benchmark Study report 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 to get my numbers in line with the profit leaders?
- How do my cash flow and liquidity levels compare to others?
- How much more cash would I have if I managed my receivables as well as my peers?
- 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.
I received my personal copy today of the benchmark study, and must tell you: it couldn't have come at a better time. I can't wait to show my benchmarks to my lender because it corroborates everything I was showing and projecting, not to mention that I have outperformed in most categories. Thank you!
- Gary Simon, Simon Jewelers
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.
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.
Managing a business without Profit Mastery is like driving to an unfamiliar destination without a roadmap!
Sign up today!
- Alonso Arellano, Latin Business Association
WHAT IS PROFIT MASTERY?
Profit Mastery is a financial performance systemthat will provide the differentiating point in the market that can catalyze your company’s success. Over the years, we have worked extensively with hundreds of companies, universities, trade associations, banks, pharmacies and franchise networks — large and small — to bring the Profit Mastery resources to thousands of their staff, customers, and prospects. Although originally perceived to be a training program, the real outcomes were actually centered around business performance, business development, and retention.
Profit Mastery has an international reputation for providing unparalleled financial management and business planning education and resources to owners, managers, advisors, and bankers of independent business. We have developed a unique way of providing education thousands of business owners have described as “the best program they have ever attended” and “they will never look at their businesses they same way again!” We accomplish this by utilizing a unique combination of information, motivation…and humor!
Here are just a few of the skills we can help you build:
- Diagnose and monitor your company's financial performance
- Use break-even analysis to make better decisions relating to cost, price, and profits
- Avoid cash crunches and increase cash flow
- Plan for and manage growth
- Communicate more effectively with bankers and other financial professionals
- Structure a loan that's the right fit for your business