The Australian Taxation Office (ATO) has just rolled out its latest set of Small Business Benchmarks, offering valuable insights into performance standards across more than 100 industries. Whether you run a local café, manage a team of electricians, or own a hair salon, these benchmarks can provide a quick, informative snapshot of how your business compares to others in your field.
📊 What Are Small Business Benchmarks?
Small Business Benchmarks are performance indicators based on real data from thousands of businesses throughout Australia. They highlight key financial ratios such as:
- Cost of sales to turnover
- Total expenses to turnover
- Labour and rent expenses to turnover
- Profit margins
These figures are broken down by industry, making it easy for you to see how your numbers compare to others in your line of work. The ATO collects and analyses this data to help ensure a level playing field—and to encourage best practices when it comes to business management and tax compliance. But for business owners, the real value lies in using this benchmark data as a business health check.
🧩 Why They’re Worth Checking
Every business is unique, but benchmarks offer a powerful starting point. If your business is performing significantly outside the typical range for your industry, it may be a sign that something needs closer attention.
Here are a few reasons why you might want to dive into the benchmarks:
- Spot inefficiencies: High expenses compared to industry norms? It could be time to revisit your cost structures.
- Refine pricing: If your profit margins are low, a pricing strategy review might be in order.
- Plan for growth: Use the data as a roadmap for setting realistic, achievable goals based on industry performance.
Even if your figures are right in the middle of the pack, reviewing benchmarks annually can help you stay competitive and maintain a sharp focus on the numbers that matter.
💡But Context Still Matters
While benchmarks are incredibly helpful, they’re not the full story. They’re based on averages—and averages don’t always reflect the nuances of your individual business.
For instance:
- A new business might have higher start-up costs.
- Location can affect rent and wages.
- Specialised services or seasonal work can skew income and expenses.
So, while benchmarks are a helpful tool, they should be considered alongside your own internal data, goals, and market conditions.
🔗Ready to Benchmark Your Business?
If you’re curious to see where your business stands, the ATO has made it simple. You can browse industry-specific benchmarks directly on their website:
👉ATO Small Business Benchmarks
At PMG Finance, we work closely with business owners all over Australia in helping them to find the right finance solutions for growth.
👉If part of your plan involves purchasing equipment or expanding your operations talk to the PMG team today.
Let’s make sure your numbers are working for you – not against you.
Contact us on 07 4639 1011 to learn more about how we can support your business in 2025 and beyond.
LinkedIn
DISCLAIMER: The above content is to provide general information and does not constitute financial, legal or other advice. This means that duties and requirements imposed on people who give financial advice do not apply to this content. For advice contact your accountant or legal advisor.