Posted: 17 March 2015 # Benchmarking Benchmarking is a comparison of a business’ operating Key Performance Indicators (KPIs) and financial ratios with best practice and average performance data relating to similar businesses. The utilisation of benchmarking tool is an integral part of an accountant supplying a business advisory service to his/her business clients. It’s very difficult for small businesses to find authentic data against which to compare their performance to that of their peers, as this information is generally not known or released. [![Benchmarking](https://www.essbiztools.com/images/zoo/blogs/2015/03/Benchmarking-300x300.jpg)](https://www.essbiztools.com/images/zoo/blogs/2015/03/Benchmarking.jpg)An accounting/advisory firm can assist the small business operator to effectively “drill down” into their figures by arranging full, credible benchmark comparisons, to be compared to the small/medium enterprise’s business. This will allow the calculation of a number of key indicators, including: - revenue generated per full time equivalent employee; - gross profit percentage; - labour to turnover percentage; - net profit percentage to turnover; and - other key operating figures. Benchmarking can also be undertaken through a wide range of other business activities, including: - leadership; - market; - people; - empowerment; - service to customers; - process management; and - adoption of innovation. Benchmarking is not new to businesses. Other activities such as sport have been doing “benchmarking” for hundreds of years. Cricketers have been calculating benchmarks since the game started. In fact, one of the great joys of following cricket is the understanding of the run-rates, highset score, batting averages score in first test, number of wickets taken, bowling averages, etc. Sportsmen readily identify with PB (Personal Best). Businesses have much to gain by adopting the similar relationship with benchmarks as sportspersons do. Analysing benchmarks is a great way for an accountant/adviser to have a clear understanding of what is occurring in their client’s business and then be able to suggest realistic strategies to improve the performance of a business. This is proactive business advisory services for clients. # Podcast '[Accountant's Minute](https://itunes.apple.com/au/podcast/accountantsminutes-podcast/id912319753?mt=2&ign-mpt=uo%3D4)' ## Latest business advisory news for Accountants in under a minute. ### Episode 017 Benchmarking Podcast Link: #### **As their trusted advisor, can you assist your SME clients with business advisory services?** To download the free material click the link below:- {snippet free-report} Watch out for the next episode of "Accountant's Minute" or subscribe to the podcast on iTunes for more news, ideas and tips on providing outstanding non-compliance services to SME clients. #### ESS BIZTOOLS Blogs ### Recent Posts... [![Help SMEs Buy a Business With Confidence](https://www.essbiztools.com/media/yootheme/cache/c1/am470banner-c1973e0e.jpg "Help SMEs Buy a Business With Confidence")](https://www.essbiztools.com/ess-biztools-blogs/help-smes-buy-a-business-with-confidence) [Help SMEs Buy a Business With Confidence](https://www.essbiztools.com/ess-biztools-blogs/help-smes-buy-a-business-with-confidence) [![Understanding the True Cost of Labour](https://www.essbiztools.com/media/yootheme/cache/98/am469banner-9837df31.jpg "Understanding the True Cost of Labour")](https://www.essbiztools.com/ess-biztools-blogs/understanding-the-true-cost-of-labour) [Understanding the True Cost of Labour](https://www.essbiztools.com/ess-biztools-blogs/understanding-the-true-cost-of-labour) [![Advisory Services In Action](https://www.essbiztools.com/media/yootheme/cache/62/am468banner-62a14bfb.jpg "Advisory Services In Action")](https://www.essbiztools.com/ess-biztools-blogs/advisory-services-in-action) [Advisory Services In Action](https://www.essbiztools.com/ess-biztools-blogs/advisory-services-in-action) [![Unlock Your Virtual CFO Advisory Opportunity](https://www.essbiztools.com/media/yootheme/cache/48/am467banner-484fb152.jpg "Unlock Your Virtual CFO Advisory Opportunity")](https://www.essbiztools.com/ess-biztools-blogs/unlock-your-virtual-cfo-advisory-opportunity) [Unlock Your Virtual CFO Advisory…](https://www.essbiztools.com/ess-biztools-blogs/unlock-your-virtual-cfo-advisory-opportunity) [![Are Your Tradie Clients Charging Enough For Profit?](https://www.essbiztools.com/media/yootheme/cache/07/am466banner-074deba7.jpg "Are Your Tradie Clients Charging Enough For Profit?")](https://www.essbiztools.com/ess-biztools-blogs/are-your-tradie-clients-charging-enough-for-profit) [Are Your Tradie Clients Charging Enough…](https://www.essbiztools.com/ess-biztools-blogs/are-your-tradie-clients-charging-enough-for-profit) [![Are Your SME Clients Managing Debtors Effectively?](https://www.essbiztools.com/media/yootheme/cache/ab/am465banner-abbd7953.jpg "Are Your SME Clients Managing Debtors Effectively?")](https://www.essbiztools.com/ess-biztools-blogs/are-your-sme-clients-managing-debtors-effectively) [Are Your SME Clients Managing Debtors…](https://www.essbiztools.com/ess-biztools-blogs/are-your-sme-clients-managing-debtors-effectively) [![Why Advisory Starts With ESS BIZTOOLS](https://www.essbiztools.com/media/yootheme/cache/4d/am464banner-4dedb597.jpg "Why Advisory Starts With ESS BIZTOOLS")](https://www.essbiztools.com/ess-biztools-blogs/why-advisory-starts-with-ess-biztools) [Why Advisory Starts With ESS BIZTOOLS](https://www.essbiztools.com/ess-biztools-blogs/why-advisory-starts-with-ess-biztools) [![Benchmarking and Valuation for Advisory Growth](https://www.essbiztools.com/media/yootheme/cache/fb/am463banner-fbfc65a4.jpg "Benchmarking and Valuation for Advisory Growth")](https://www.essbiztools.com/ess-biztools-blogs/benchmarking-and-valuation-for-advisory-growth) [Benchmarking and Valuation for Advisory…](https://www.essbiztools.com/ess-biztools-blogs/benchmarking-and-valuation-for-advisory-growth) [![Debtors Management: An Advisory Service Every SME Needs](https://www.essbiztools.com/media/yootheme/cache/36/am462banner-36bb3bf1.jpg "Debtors Management: An Advisory Service Every SME Needs")](https://www.essbiztools.com/ess-biztools-blogs/debtors-management-an-advisory-service-every-sme-needs) [Debtors Management: An Advisory Service…](https://www.essbiztools.com/ess-biztools-blogs/debtors-management-an-advisory-service-every-sme-needs) [![The Advisory Services Sales Challenge](https://www.essbiztools.com/media/yootheme/cache/7a/am461banner-7a6ee64b.jpg "The Advisory Services Sales Challenge")](https://www.essbiztools.com/ess-biztools-blogs/the-advisory-services-sales-challenge) [The Advisory Services Sales Challenge](https://www.essbiztools.com/ess-biztools-blogs/the-advisory-services-sales-challenge) [![Practical Advisory Support for SME Start-Ups](https://www.essbiztools.com/media/yootheme/cache/f8/am460banner-f810f0e9.jpg "Practical Advisory Support for SME Start-Ups")](https://www.essbiztools.com/ess-biztools-blogs/practical-advisory-support-for-sme-start-ups) [Practical Advisory Support for SME…](https://www.essbiztools.com/ess-biztools-blogs/practical-advisory-support-for-sme-start-ups) [![How Benchmarking Reveals Hidden Profit Opportunities](https://www.essbiztools.com/media/yootheme/cache/34/am459banner-3450d39d.jpg "How Benchmarking Reveals Hidden Profit Opportunities")](https://www.essbiztools.com/ess-biztools-blogs/how-benchmarking-reveals-hidden-profit-opportunities) [How Benchmarking Reveals Hidden Profit…](https://www.essbiztools.com/ess-biztools-blogs/how-benchmarking-reveals-hidden-profit-opportunities) [![Shrinkage and Budgeting: Protecting SME Cash Flow](https://www.essbiztools.com/media/yootheme/cache/bf/am458banner-bf45cf0d.jpg "Shrinkage and Budgeting: Protecting SME Cash Flow")](https://www.essbiztools.com/ess-biztools-blogs/shrinkage-and-budgeting-protecting-sme-cash-flow) [Shrinkage and Budgeting: Protecting SME…](https://www.essbiztools.com/ess-biztools-blogs/shrinkage-and-budgeting-protecting-sme-cash-flow) [![The Engine Room of Business Advisory](https://www.essbiztools.com/media/yootheme/cache/52/am457banner-52f3ff1b.jpg "The Engine Room of Business Advisory")](https://www.essbiztools.com/ess-biztools-blogs/the-engine-room-of-business-advisory) [The Engine Room of Business Advisory](https://www.essbiztools.com/ess-biztools-blogs/the-engine-room-of-business-advisory) [![Helping SMEs Navigate Cash Flow Pressure](https://www.essbiztools.com/media/yootheme/cache/4d/am456banner-4da9d4db.jpg "Helping SMEs Navigate Cash Flow Pressure")](https://www.essbiztools.com/ess-biztools-blogs/helping-smes-navigate-cash-flow-pressure) [Helping SMEs Navigate Cash Flow Pressure](https://www.essbiztools.com/ess-biztools-blogs/helping-smes-navigate-cash-flow-pressure) [![Supply Chains and Cash Flow Survival](https://www.essbiztools.com/media/yootheme/cache/cd/am455banner-cd8d83d0.jpg "Supply Chains and Cash Flow Survival")](https://www.essbiztools.com/ess-biztools-blogs/supply-chains-and-cash-flow-survival) [Supply Chains and Cash Flow Survival](https://www.essbiztools.com/ess-biztools-blogs/supply-chains-and-cash-flow-survival) [![Why Advisory Services Matter More Than Ever](https://www.essbiztools.com/media/yootheme/cache/c8/am454banner-c88c183a.jpg "Why Advisory Services Matter More Than Ever")](https://www.essbiztools.com/ess-biztools-blogs/why-advisory-services-matter-more-than-ever) [Why Advisory Services Matter More Than…](https://www.essbiztools.com/ess-biztools-blogs/why-advisory-services-matter-more-than-ever) [![Talent Retention Starts With Advisory Services](https://www.essbiztools.com/media/yootheme/cache/65/am453banner-65f62b21.jpg "Talent Retention Starts With Advisory Services")](https://www.essbiztools.com/ess-biztools-blogs/talent-retention-starts-with-advisory-services) [Talent Retention Starts With Advisory…](https://www.essbiztools.com/ess-biztools-blogs/talent-retention-starts-with-advisory-services) [![SME Survival Starts With You](https://www.essbiztools.com/media/yootheme/cache/22/am452banner-22ac26d5.jpg "SME Survival Starts With You")](https://www.essbiztools.com/ess-biztools-blogs/sme-survival-starts-with-you) [SME Survival Starts With You](https://www.essbiztools.com/ess-biztools-blogs/sme-survival-starts-with-you) [![From Compliance to Virtual CFO Leadership](https://www.essbiztools.com/media/yootheme/cache/15/am451banner-15c741fd.jpg "From Compliance to Virtual CFO Leadership")](https://www.essbiztools.com/ess-biztools-blogs/from-compliance-to-virtual-cfo-leadership) [From Compliance to Virtual CFO…](https://www.essbiztools.com/ess-biztools-blogs/from-compliance-to-virtual-cfo-leadership) [![The Talent Crisis in Accounting Firms](https://www.essbiztools.com/media/yootheme/cache/70/am450banner-7054eff9.jpg "The Talent Crisis in Accounting Firms")](https://www.essbiztools.com/ess-biztools-blogs/the-talent-crisis-in-accounting-firms) [The Talent Crisis in Accounting Firms](https://www.essbiztools.com/ess-biztools-blogs/the-talent-crisis-in-accounting-firms) [![The 85% Advisory Gap in Accounting Firms](https://www.essbiztools.com/media/yootheme/cache/97/am449banner-9723b44e.jpg "The 85% Advisory Gap in Accounting Firms")](https://www.essbiztools.com/ess-biztools-blogs/the-85-advisory-gap-in-accounting-firms) [The 85% Advisory Gap in Accounting Firms](https://www.essbiztools.com/ess-biztools-blogs/the-85-advisory-gap-in-accounting-firms) [![Start Advisory Services Without Changing Your Firm](https://www.essbiztools.com/media/yootheme/cache/de/am448banner-deaaeb54.jpg "Start Advisory Services Without Changing Your Firm")](https://www.essbiztools.com/ess-biztools-blogs/start-advisory-services-without-changing-your-firm) [Start Advisory Services Without…](https://www.essbiztools.com/ess-biztools-blogs/start-advisory-services-without-changing-your-firm) [![Helping SMEs Navigate Tough Business Conditions](https://www.essbiztools.com/media/yootheme/cache/16/am447banner-16d3cc5c.jpg "Helping SMEs Navigate Tough Business Conditions")](https://www.essbiztools.com/ess-biztools-blogs/helping-smes-navigate-tough-business-conditions) [Helping SMEs Navigate Tough Business…](https://www.essbiztools.com/ess-biztools-blogs/helping-smes-navigate-tough-business-conditions) [![Starting the Journey: Where Advisory Really Begins](https://www.essbiztools.com/media/yootheme/cache/65/am446banner-654085c5.jpg "Starting the Journey: Where Advisory Really Begins")](https://www.essbiztools.com/ess-biztools-blogs/starting-the-journey-where-advisory-really-begins) [Starting the Journey: Where Advisory…](https://www.essbiztools.com/ess-biztools-blogs/starting-the-journey-where-advisory-really-begins) [![Transforming Client Relationships Through Advisory Services](https://www.essbiztools.com/media/yootheme/cache/51/am445banner-518c5c26.jpg "Transforming Client Relationships Through Advisory Services")](https://www.essbiztools.com/ess-biztools-blogs/transforming-client-relationships-through-advisory-services) [Transforming Client Relationships…](https://www.essbiztools.com/ess-biztools-blogs/transforming-client-relationships-through-advisory-services) [![The Path to Key Strategic Partner Status](https://www.essbiztools.com/media/yootheme/cache/ec/am444banner-ecf4fbf4.jpg "The Path to Key Strategic Partner Status")](https://www.essbiztools.com/ess-biztools-blogs/the-path-to-key-strategic-partner-status) [The Path to Key Strategic Partner Status](https://www.essbiztools.com/ess-biztools-blogs/the-path-to-key-strategic-partner-status) [![Turn Advisory Into Your Firm's Growth Engine](https://www.essbiztools.com/media/yootheme/cache/6f/am443banner-6f5be189.jpg "Turn Advisory Into Your Firm's Growth Engine")](https://www.essbiztools.com/ess-biztools-blogs/turn-advisory-into-your-firms-growth-engine) [Turn Advisory Into Your Firm's Growth…](https://www.essbiztools.com/ess-biztools-blogs/turn-advisory-into-your-firms-growth-engine) [![Close the Gap to Top 20% Performance](https://www.essbiztools.com/media/yootheme/cache/ef/am442banner-ef4d9f28.jpg "Close the Gap to Top 20% Performance")](https://www.essbiztools.com/ess-biztools-blogs/close-the-gap-to-top-20-performance) [Close the Gap to Top 20% Performance](https://www.essbiztools.com/ess-biztools-blogs/close-the-gap-to-top-20-performance) [![Advisory Services Are Sold - Not Bought](https://www.essbiztools.com/media/yootheme/cache/a2/am441banner-a29e9019.jpg "Advisory Services Are Sold - Not Bought")](https://www.essbiztools.com/ess-biztools-blogs/advisory-services-are-sold-not-bought) [Advisory Services Are Sold - Not Bought](https://www.essbiztools.com/ess-biztools-blogs/advisory-services-are-sold-not-bought) [![Achieving The Change Your Firm Wants To See](https://www.essbiztools.com/media/yootheme/cache/96/am440banner-96d92355.jpg "Achieving The Change Your Firm Wants To See")](https://www.essbiztools.com/ess-biztools-blogs/achieving-the-change-your-firm-wants-to-see) [Achieving The Change Your Firm Wants To…](https://www.essbiztools.com/ess-biztools-blogs/achieving-the-change-your-firm-wants-to-see) [![Be The Change You Want To See](https://www.essbiztools.com/media/yootheme/cache/8d/am439banner-8d5aa800.jpg "Be The Change You Want To See")](https://www.essbiztools.com/ess-biztools-blogs/be-the-change-you-want-to-see-2) [Be The Change You Want To See](https://www.essbiztools.com/ess-biztools-blogs/be-the-change-you-want-to-see-2) [![Lead SMEs Through the Innovation Journey: Final Part](https://www.essbiztools.com/media/yootheme/cache/f0/am438banner-f05cd606.jpg "Lead SMEs Through the Innovation Journey: Final Part")](https://www.essbiztools.com/ess-biztools-blogs/lead-smes-through-the-innovation-journey-final-part) [Lead SMEs Through the Innovation…](https://www.essbiztools.com/ess-biztools-blogs/lead-smes-through-the-innovation-journey-final-part) [![Lead SMEs Through the Innovation Journey: Part 3](https://www.essbiztools.com/media/yootheme/cache/95/am437banner-958e4698.jpg "Lead SMEs Through the Innovation Journey: Part 3")](https://www.essbiztools.com/ess-biztools-blogs/lead-smes-through-the-innovation-journey-part-3) [Lead SMEs Through the Innovation…](https://www.essbiztools.com/ess-biztools-blogs/lead-smes-through-the-innovation-journey-part-3) [![Lead SMEs Through the Innovation Journey: Part 2](https://www.essbiztools.com/media/yootheme/cache/7d/am436banner-7d2513df.jpg "Lead SMEs Through the Innovation Journey: Part 2")](https://www.essbiztools.com/ess-biztools-blogs/lead-smes-through-the-innovation-journey-part-2) [Lead SMEs Through the Innovation…](https://www.essbiztools.com/ess-biztools-blogs/lead-smes-through-the-innovation-journey-part-2) [![BLACK FRIDAY FEATURE ARTICLE: Lead SMEs Through the Innovation Journey](https://www.essbiztools.com/media/yootheme/cache/ac/am435banner-ac1e6859.jpg "BLACK FRIDAY FEATURE ARTICLE: Lead SMEs Through the Innovation Journey")](https://www.essbiztools.com/ess-biztools-blogs/black-friday-feature-article-lead-smes-through-the-innovation-journey) [BLACK FRIDAY FEATURE ARTICLE: Lead SMEs…](https://www.essbiztools.com/ess-biztools-blogs/black-friday-feature-article-lead-smes-through-the-innovation-journey) [![Empower Tradies With Stronger Pricing Strategies](https://www.essbiztools.com/media/yootheme/cache/e3/am434banner-e32447fc.jpg "Empower Tradies With Stronger Pricing Strategies")](https://www.essbiztools.com/ess-biztools-blogs/empower-tradies-with-stronger-pricing-strategies) [Empower Tradies With Stronger Pricing…](https://www.essbiztools.com/ess-biztools-blogs/empower-tradies-with-stronger-pricing-strategies) [![Transform Into Key Strategic Partner](https://www.essbiztools.com/media/yootheme/cache/ca/am433banner-cae069c6.jpg "Transform Into Key Strategic Partner")](https://www.essbiztools.com/ess-biztools-blogs/transform-into-key-strategic-partner) [Transform Into Key Strategic Partner](https://www.essbiztools.com/ess-biztools-blogs/transform-into-key-strategic-partner) [![The Road to Advisory Excellence Starts Now](https://www.essbiztools.com/media/yootheme/cache/e2/am432banner-e2178baa.jpg "The Road to Advisory Excellence Starts Now")](https://www.essbiztools.com/ess-biztools-blogs/the-road-to-advisory-excellence-starts-now) [The Road to Advisory Excellence Starts…](https://www.essbiztools.com/ess-biztools-blogs/the-road-to-advisory-excellence-starts-now) [![Your Launchpad into Business Advisory Services](https://www.essbiztools.com/media/yootheme/cache/64/am431banner-64f247b1.jpg "Your Launchpad into Business Advisory Services")](https://www.essbiztools.com/ess-biztools-blogs/your-launchpad-into-business-advisory-services) [Your Launchpad into Business Advisory…](https://www.essbiztools.com/ess-biztools-blogs/your-launchpad-into-business-advisory-services) [![Boost Business Sale Value for SMEs](https://www.essbiztools.com/media/yootheme/cache/7b/am430banner-7b6b0cbe.jpg "Boost Business Sale Value for SMEs")](https://www.essbiztools.com/ess-biztools-blogs/boost-business-sale-value-for-smes) [Boost Business Sale Value for SMEs](https://www.essbiztools.com/ess-biztools-blogs/boost-business-sale-value-for-smes) [![Guide SMEs to Growth Through Crowd Sourced Funding](https://www.essbiztools.com/media/yootheme/cache/bc/am429banner-bc3619fd.jpg "Guide SMEs to Growth Through Crowd Sourced Funding")](https://www.essbiztools.com/ess-biztools-blogs/guide-smes-to-growth-through-crowd-sourced-funding) [Guide SMEs to Growth Through Crowd…](https://www.essbiztools.com/ess-biztools-blogs/guide-smes-to-growth-through-crowd-sourced-funding) [![The Hidden Gaps in Business Buyers' Knowledge](https://www.essbiztools.com/media/yootheme/cache/f3/am428banner-f3aa7877.jpg "The Hidden Gaps in Business Buyers' Knowledge")](https://www.essbiztools.com/ess-biztools-blogs/the-hidden-gaps-in-business-buyers-knowledge) [The Hidden Gaps in Business Buyers'…](https://www.essbiztools.com/ess-biztools-blogs/the-hidden-gaps-in-business-buyers-knowledge) [![R&D Tax Incentive: Advisory Opportunity for Your Firm](https://www.essbiztools.com/media/yootheme/cache/0d/am427banner-0d79af38.jpg "R&D Tax Incentive: Advisory Opportunity for Your Firm")](https://www.essbiztools.com/ess-biztools-blogs/r-d-tax-incentive-advisory-opportunity-for-your-firm) [R&D Tax Incentive: Advisory Opportunity…](https://www.essbiztools.com/ess-biztools-blogs/r-d-tax-incentive-advisory-opportunity-for-your-firm) [![Debtors Management: A Strategic Advisory Opportunity](https://www.essbiztools.com/media/yootheme/cache/3c/am426banner-3c459110.jpg "Debtors Management: A Strategic Advisory Opportunity")](https://www.essbiztools.com/ess-biztools-blogs/debtors-management-a-strategic-advisory-opportunity) [Debtors Management: A Strategic…](https://www.essbiztools.com/ess-biztools-blogs/debtors-management-a-strategic-advisory-opportunity) [![The Blueprint to Selling Advisory Services](https://www.essbiztools.com/media/yootheme/cache/d0/am425banner-d0452a7b.jpg "The Blueprint to Selling Advisory Services")](https://www.essbiztools.com/ess-biztools-blogs/the-blueprint-to-selling-advisory-services) [The Blueprint to Selling Advisory…](https://www.essbiztools.com/ess-biztools-blogs/the-blueprint-to-selling-advisory-services) [![Transforming Tax Work Into Business Growth](https://www.essbiztools.com/media/yootheme/cache/7b/am424banner-7bbe47f6.jpg "Transforming Tax Work Into Business Growth")](https://www.essbiztools.com/ess-biztools-blogs/transforming-tax-work-into-business-growth) [Transforming Tax Work Into Business…](https://www.essbiztools.com/ess-biztools-blogs/transforming-tax-work-into-business-growth) [![Building Future-Ready Advisory Firms](https://www.essbiztools.com/media/yootheme/cache/fe/am423banner-fe3277a2.jpg "Building Future-Ready Advisory Firms")](https://www.essbiztools.com/ess-biztools-blogs/building-future-ready-advisory-firms) [Building Future-Ready Advisory Firms](https://www.essbiztools.com/ess-biztools-blogs/building-future-ready-advisory-firms) [![The Rise of Business Advisory Sevices](https://www.essbiztools.com/media/yootheme/cache/f4/am422banner-f4d727b2.jpg "The Rise of Business Advisory Sevices")](https://www.essbiztools.com/ess-biztools-blogs/the-rise-of-business-advisory-sevices) [The Rise of Business Advisory Sevices](https://www.essbiztools.com/ess-biztools-blogs/the-rise-of-business-advisory-sevices) [![Smart Pricing Strategies: The Key to SME Profitability](https://www.essbiztools.com/media/yootheme/cache/c4/am421banner-c4cfb7ab.jpg "Smart Pricing Strategies: The Key to SME Profitability")](https://www.essbiztools.com/ess-biztools-blogs/smart-pricing-strategies-the-key-to-sme-profitability) [Smart Pricing Strategies: The Key to…](https://www.essbiztools.com/ess-biztools-blogs/smart-pricing-strategies-the-key-to-sme-profitability) #### Tags used in post...