How do you measure up?

Industry ratios can be incredibly important tools for running your business. Knowing how you compare to other businesses that are your size and do what you do is pretty valuable.

For example, if your company spends 10.9% of its budget on rent and you find out that most companies in your industry only spend 6.5%, then you know you are probably spending more than you should. Using these statistics, you can make adjustments to bring your financials in line and ensure better profitability.

Trade associations are often a good source for industry-specific ratios. You might have to dig to find your ratios, but no matter where you get them, they are important numbers to have.