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Why do small business owners compare their ratios to other firms in the same industry?

Why do small business owners compare their ratios to other firms in the same industry?

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Small business owners do not have their firms listed and as such may not be able to assess their performance feedback from the market unlike large firms which are listed. This would encourage the owners to compare their firms ratios like liquidity, solvency, profitability and leverage ratios with other firms in the same industry to arrive at a relative performance evaluation and valuation for their own businesses in the event of selling the business to a larger player.

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