In an increasingly competitive landscape, trying to get to the (or stay on) top of your industry, get maximum results and ultimately grow your business can be challenging. It’s hard to stand out from the crowd, if you don’t know what the crowd is doing. This is where benchmarking comes in.
Benchmarking is a form of competitive analysis, where you compare your organisation to others in your market. It can be done for whole businesses, or particular products and functions – depending on what your current focus is. The goal is to measure your own business performance and where necessary, make improvements or adjustments to get you closer to your goals.
Why Benchmarking Works
Understanding the strengths and weaknesses of your competitors helps you highlight, fix and focus on your own.
It’s easy for us to sit within our own organisation, check our forecasts and results and feel confident that our clients and customers are happy. That internal reporting and reflection is important but it can be difficult to know what’s missing or how it compares with other experiences your clients and customers may have.
Benchmarking involves comparing your performance against that of others in your market or industry. It doesn’t mean that you need to immediately implement or copy anything that other businesses are doing, but it does let you know how you stack up and where your own opportunities for improvement may be. Sometimes having that clear point of difference – if it makes sense for your target audience and your bottom line – is one of your best selling points.
Benefits of Benchmarking
Here are some of the key ways benchmarking helps your business:
- You can identify opportunities for growth and improvement
- You will better understand industry trends, offers and consumer behaviour which can be valuable in your own decision making
- You will understand how your business performs against external standards and expectations
- You can do this against businesses in your own region, or even across the world which gives you greater insight into your business’ potential and possibilities
How To Benchmark
To benchmark well, you need to have a good foundation in place first. Benchmarking is not just getting your wife or husband to mystery shop your key competitor. It’s a long term and continual process and it’s important to have your objectives, figures and data streamlined first. Then you can make sure you’re actually comparing apples and apples when it comes to looking into how others are performing.
Accru Can Benchmark For You
Benchmarking and business performance is something that your Accru Advisor can assist you with. Some of the most tedious and easy to make mistakes with steps of benchmarking are our strengths – we can collect and collate financial and performance data for your business and others and provide guidance on what you should be benchmarking and how the findings could improve your business.
Book an appointment with your Accru Advisor to start exploring how benchmarking could help you.
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