Horizon Sets The Benchmark For Small Business Success

HORIZON Credit Union has launched an innovative benchmarking tool for small business.

Recognising that 75 per cent of small businesses fail in their first year, the Illawarra-based credit union decided to introduce a service for members that went beyond its normal commercial loan facility.

The benchmarking tool is designed to allow anyone seeking finance for a small business, either at start-up phase or in growth phase, to compare their existing financial status with others in comparable industries.

Horizon Credit Union loans manager Bill Taylor said the unique service was provided to members through an arrangement with the University of New England.

He said the university undertook research that allowed small business owners to compare their performance against other businesses of similar nature. The performance measures assessed included personnel, productivity and profit margins, major overheads as a percentage of total income and turnover.

``The software used by Horizon is extremely sophisticated and is commonly used by accountants and financial planners. The report is totally independent and Horizon provides it to its commercial borrowers for free, a service that would normally cost between $300 and $600," Mr Taylor said.

He said the resource was available to ensure small business owners or potential owners had an opportunity to make an informed decision on their investment.

``We feel a responsibility to our members to do all in our power to help make their business venture a success," he said.

Mr Taylor said one of Horizon's first members to experience the benefits of the report was Manns Sportscene proprietor Dean Bagnall, of Nowra.

``It was good to see how the business compared to others in a report and it showed that we were on the right track in most areas. It also alerted us to potential problems such as the fact that our gross profit percentage needed to go up a bit," Mr Bagnall said.