Knowing where your business stands relative to industry is key for setting goals and measuring growth as a business owner.
Canada is a hub for a number of businesses across various industries, each of which has different standards and financial performance indicators. To compare apples with apples, it is important to use industry-specific information in benchmarking your businesses progress.
There are various differences among industries that impact a company’s growth rates, profitability, and other non-financial metrics that provide an insight into a company’s success. Non-Financial metrics are important to assess qualitative components of your business, or operational efficiency.
Below are industry-specific indicators, both financial and non-financial, you can use to measure your performance:
Food Services & Drinking Places
- Average revenue per guest
- Profit margin per table
- Food cost percentage
- Customer satisfaction vs. complaints
- Asset utilization
- Cycle time
- Mean time between failure (MTBF)
- Order to shipment time
- Cost of goods sold (COGS)
- Average inventory
- Accounts receivable turnover
- Sales per square foot of retail space
- Project completion ratio: Actual vs. baseline
- Number of accidents
- Cost predictability
- Cash balance
Transportation & Warehousing
- Current book to fulfill ratio
- On-time pickups and deliveries
- Transit time
- Monetary value of booked orders
Another important indicator is the Debt-Equity ratio, which measures the amount of financial leverage (credit/loans) you are utilizing relative to your owned assets. A low debt-equity ratio means you may not be utilizing debt efficiently to take on new projects or expand, while a high debt-equity ratio puts your business at a higher risk of bankruptcy. It is important to find a balance between the two, and access high-quality financing options at a sustainable interest rate.
Indicators allow you to refocus on areas of improvement, and track performance within these areas over a period of time using numeric methods. Tracking key performance indicators is important for maintaining a clear vision of where your business is headed.