How to Compare Your G&A Spend Against Industry Peers

General and administrative (G&A) spend is one of the most misunderstood parts of a company’s cost structure. It is also one of the easiest to overlook because many leaders naturally focus their attention on the top line, also known as revenue. As a result, teams often track the total G&A without really understanding what it means.

Leaders know how much they spend, but far fewer know whether that level of spend is healthy, sustainable, or aligned with similar companies in their industry. Benchmarking shines the light on whether your G&A spend is reasonable.

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This guide explains how to compare your G&A spend to similar companies in a reliable and practical way. It will show you which ratios matter, how to choose the right benchmarking data, and how to interpret your results without falling into common traps.

Contents

• Introduction
• What is G&A Spend?
• G&A Ratios to Track
• Benchmarking Your G&A Spend
• Choosing Benchmark Data
• Interpreting Benchmark Results
• Best Practices Summary
• FAQs

What is G&A Spend?

The short answer is that G&A spend covers the core functions that keep a company running. These functions may not generate revenue directly, but they are essential to stability and scale. They typically includes finance, accounting, human resources, legal, internal IT, administration, and similar support functions.

Many leaders underestimate G&A because the category feels like a cost bucket with no obvious levers. The truth is that G&A is rich with opportunities for improvement. A clear view into this spend often reveals patterns that distort performance. Examples include replacing outdated systems, manual processes, or staffing levels that no longer align with company size. Benchmarking helps to highlight those patterns by comparing your numbers against relevant competitors.

G&A Ratios to Track

If you want a fast and clear sense of G&A performance, these five ratios give the strongest signals.

1. G&A spend as a % of revenue – This is the quickest, easiest, and best ratio to track if you’re short on time. It’s also relatively straightforward to collate benchmarking data.
2. G&A spend per employee
3. Finance spend as a % of revenue
4. Human resources spend per employee
5. IT spend per employee

The best approach is to track all five ratios together, so that you can gauge both the overall and functional view of how your G&A spend stacks up to similar companies. For example, if you only measure G&A spend as a % of revenue, then you may know whether the ratio is high or low, but without the other ratios you won’t know which function is driving G&A costs upward.

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Benchmarking Your G&A Spend

The key insight is that benchmarking is most useful when you compare your company to a group that looks like you. The three “get rights” when it comes to benchmarking are industry, size, and geography. Here is a reliable approach to benchmarking your G&A:

1. Define your peer group based on your industry, revenue range, and geography.
2. Gather G&A data for your peer group - Tip: Leverage third-party benchmarking data providers like CompanySights to source trusted information quickly and easily.‍
3. Use ratios rather than raw numbers. Refer to the five ratios listed in the previous section.
4. Pay attention to the mid-range, rather than averages and extremes.
5. Explore differences between your company and benchmarks by understanding the context of your company. For example, if your company has lower G&A spend as % of revenue compared to benchmarks, is it because your company is efficient or underfunding? Context is everything.

We often find that peer group quality determines the value of your results. A company with 100 employees will never match the cost structure of a company with 10,000 employees. Likewise, software companies, retailers, and manufacturing firms all carry different G&A patterns because their operating models differ.

So, make sure to build a peer group that is as similar to your company as possible!

Choosing Benchmark Data

The best data source is the one that is accurate, recent, and tailored to your business. Not all benchmarking data meets all three requirements. When choosing data, evaluate:

• How the data is collected
• Whether the peer sets match your profile
• The level of detail for G&A functions and sub-functions
• Frequency of updates
• Consistency in definitions

Avoid data sources that group companies too broadly, such as an average number across an entire sector. Instead, find a focused peer set specific to your business that gives you insight you can actually act on.

If you have access to a benchmarking provider that specializes in cost and functional benchmarks, choose them. If not, consider a mix of public filings, investor reports, and reputable industry databases. Check for clear definitions, as many companies classify G&A differently, and inconsistent definitions will distort your analysis.

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Interpreting Benchmark Results

When benchmarking, the guiding principle is to look at benchmark ranges rather than isolated numbers. For example, we often advise clients to look at the mid-range, which is from the 25th percentile to the 75th percentile. This is more insightful than just looking at one number because it allows your company to be comparable to benchmarks.

When your company is outside of the mid-range, start by examining where your costs are higher than peers. Then look for operational reasons within your business. Some differences may be justified, such as a modern IT investment cycle or a more experienced accounting team during a complex growth phase. Other differences may indicate structural inefficiencies, which are the things to improve on!

Use this process when reviewing benchmark results:

1. Identify where your outside of the benchmark mid-range
2. Look for patterns across similar benchmark ratios
3. Validate the reasons behind these differences
4. Prioritize improvements that create the most impact

A common mistake is to set targets based on the lowest benchmark cost figure without considering the context of your business. The goal is not to be the cheapest. It’s to be the right size. Your G&A function exists to support your business strategy, and efficiency is only meaningful when quality and stability remain intact.

Best Practices Summary

The most effective companies treat G&A benchmarking as a continuous discipline rather than a one-off exercise. They embed it into annual planning cycles, resourcing decisions, and leadership discussions.

Here are some best practices to follow:

• Benchmark annually or semi-annually to track changes
• Use consistent definitions for G&A across your reporting
• Combine financial ratios with your operational context
• Align targets with company stage, not just industry norms
• Reinvest savings into initiatives that strengthen long term performance

The smartest operators use benchmarking to guide not only cost discipline but also strategic investment. When you know exactly where your structure stands relative to peers, you can make confident decisions about automation, headcount planning, technology upgrades, and capability building.

FAQs

What counts as G&A spend?

G&A includes all costs related to the core support functions that run your business, such as finance, human resources, legal, internal IT, and administration.

What is a typical G&A percent of revenue?

It varies by industry and company stage, but most mature companies fall within a predictable range once you compare them to the right peer group.

How often should I benchmark?

At minimum once a year. Fast growing companies benefit from semi-annual reviews because their cost structure shifts quickly.

How do industry differences affect G&A?

Some industries carry heavier administrative needs relative to others. This is why cross industry G&A spend averages are rarely useful.

What if my G&A is higher than the median?

Higher costs can indicate either inefficiency or strategic investment. Review the pattern across multiple ratios and understand the reasons before making changes.

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