What is the name of the analysis in which the firm's ratio values are compared to those of a key
competitor or group of competitors, primarily to identify areas for
improvement?
Answer & explanation
Correct answer: option 2
Benchmarking is a process where you measure your company’s success against other similar companies to discover if there is a gap in performance that can be closed by improving your performance. Studying other companies can highlight what it takes to enhance your company’s efficiency and become a bigger player in your industry.