Using the P&L for Business Decision Making
Now, let’s look at how Lisa can use the figures to see how she is doing compared to similar businesses.
First, we need to find out what the averages are for similar retail businesses. Using benchmarking tools mentioned at www.BizStats.com
, here are the percentages for similar small businesses.
Average Profitability & Expense Percentages for U.S. Small Businesses
Looking at the bottom line, Net Income, Lisa’s Candle Shop is below the industry average of 17.06 percent, but considering that this is a new business that’s really not bad. She needs to improve her Cost of Goods Sold. The industry average ...