What is the Industry Data Report?
Industry Data is a report that provides real time industry data, showing the number of financial statements behind each industry average. This report also allows you to filter the data through queries.
Key Facts
- Provides detailed industry-specific recommendations and key performance indicators (KPIs) for improvement in Sales, Profitability, and Liquidity
- Incorporates real-time industry data, stratified by country and/or region and/or sales range
- Industry data is compiled solely our customers
- Can be used for reference and research
- Provides current industry statistics of the industry
- Use in preparation of prospect meetings to become familiar with industry benchmarks and trends
- Shows the number of financial statements behind each industry average
- Value-added report: great for cross-selling and prospecting
Where Do the Industry Averages Come From?
The Industry Data industry averages are compiled in real-time by data entered from our existing customer base.
OVERALL TECHNOLOGY AND DATA COLLECTION METHODS
The diagram below outlines the basic methodology by which we gather and publish data:
In Figure 1, data is entered by our customers directly to our core application. As financial professionals enter data, we take the summary financial data of the company and organize it by industry sector (by NAICS or NTEE code), by sales size, and by region of the country.
In Figure 2, the financial data is screened by two basic methods:
- Customers select whether the data entered is from “actual” financial statements or is just “sample” data. Sample data is discarded by the system.
- Data that is “unusual” is also discarded from the data collection process. There are many rules that are applied to the data, but a good general guideline is that ProfitCents throws out data that is outside the bounds of two standard deviations. A two pass standard deviation approach is employed; the data is normalized, the bounds are calculated using two standard deviations, and the outliers are discarded. This process is then repeated a second time.
In Figure 3, we collect data and store it in a database, where it is updated daily. The company refreshes the data and then makes the data available in Figure 4 under “publishing.”
In Figure 4, the data is published. Only industries and segments that have three or more screened reports for each segment are published.
LIMITATIONS TO THE DATA AND THE USE OF THE DATA
Even though ProfitCents has attempted to overcome important limitations to the current methodology of gathering similar data, all benchmarking has limitations:
- Benchmarks are estimates under the best of circumstances. As such, they can never be used as absolutes.
- Benchmarks cannot always be used for qualitative “good” or “bad” judgment calls. A company that might be above a particular industry segment (be above the industry “norm”) might operate in a poor industry and make a poor investment choice despite its “above average” score on a given metric. Or, a company that might be below a particular industry segment (be below the industry “norm”) might operate in a highly profitable industry and make a great investment choice despite its “below average” score on a given metric.