Written by Nils R. | Dec 3, 2020 8:00:00 AM
What is
a
Report that
Benchmarks Your Business versus an Industry Average
? Industry benchmarking reports are considered comparative analysis tools and are often used by CFOs, executives and analysts to measure their own company's performance versus the average of a select group of competitors. Some of the key functionality in this type of benchmarking report is that it is based on available data from a pool of competitors. Often, this is data from a web-site like Yahoo Finance or a government web-site like Edgar. The example consists of eight charts, each one displaying the trend for a specific metric for the past eight quarters for your own company and the industry average. The metrics include Current Ratio, Return on Assets, Return on Equity, Profit Margin, Gross Margin, Debt to Equity, Revenue and Revenue Growth. Each chart shows data for your own company as well as the average of other companies selected when the report was executed. Underneath Below the chart sections you find tables with the data.. You find an example of this type of benchmarking report below.
Purpose of
Industry Benchmarking Reports Companies and organizations use Industry Benchmarking Reports to supplement internal variance analysis with external comparisons to ensure that the business is keeping pace with its industry peers. When used as part of good business practices in a Financial Planning & Analysis (FP&A) and Executive department, a company can improve its strategies as well as reduce the chances that it falls behind the industry averages in areas such as revenue growth.
Industry Benchmarking Report
Example Here is an example of an Industry Benchmark Report with comparison of KPIs for your own business versus the industry average. [caption id="" align="alignnone" width="1733"]
Report Example - Benchmarking Your Own Company versus an Industry Average[/caption] You can find hundreds of additional examples
here
Who Uses This Type of
Benchmarking report
? The typical users of this type of benchmarking report are: CFOs, executives, board members, and analysts.
Other
Benchmarking report
s Often Used in Conjunction with
Industry Benchmarking Reports Progressive Financial Planning & Analysis (FP&A) and Executive Departments sometimes use several different Industry Benchmarking Reports, along with benchmarking dashboards, comparative reports, KPI reports, strategy summaries and other management and control tools.
Where Does the Data for Analysis Originate From? The Actual (historical transactions) data for competitors typically comes from web sites like Yahoo Finance and Edgar, as well as internal financial data from enterprise resource planning (ERP) systems like: Microsoft Dynamics 365 (D365) Finance, Microsoft Dynamics 365 Business Central (D365 BC), Microsoft Dynamics AX, Microsoft Dynamics NAV, Microsoft Dynamics GP, Microsoft Dynamics SL, Sage Intacct, Sage 100, Sage 300, Sage 500, Sage X3, SAP Business One, SAP ByDesign, Acumatica, Netsuite and others. In analyses where budgets or forecasts are used, the planning data most often originates from in-house Excel spreadsheet models or from professional corporate performance management (CPM/EPM) solutions.
What Tools are Typically used for Reporting, Planning and Dashboards? Examples of business software used with the data and ERPs mentioned above are:
- Native ERP report writers and query tools
- Spreadsheets (for example Microsoft Excel)
- Corporate Performance Management (CPM) tools (for example Solver)
- Dashboards (for example Microsoft Power BI and Tableau)
Corporate Performance Management (CPM) Cloud Solutions and More Examples
