What Actually Happens in a Business Analysis, Week by Week
Six weeks. Eleven steps. Around eight hours of your time. Here is all of it, including what the report looks like.
Most people selling business services will not tell you what happens after you pay. You get a proposal, a promise and a start date, and the rest you find out as you go.
So here is the whole thing, step by step, with the time each part takes and a sample of what you end up holding.
What does a business analysis involve?
A Business Analysis is a structured diagnostic of your whole business, built from three sources of evidence: your own numbers, a 273-question review of how the business actually runs, and market research interviews I conduct personally with twelve people who deal with you. It takes about six weeks, costs you roughly eight hours of your own time, and produces a report of 120 pages or more that quantifies where your profit is leaking and what each fix is worth in dollars.
It is not a strategy document and it is not advice. It is a measurement of your business, and the measurement comes before anyone gets to have an opinion about what you should do.
The six weeks
Week 1: Setting up
You sign an NDA to protect your information. You authorise the investment. You complete a short personal profile so I understand what you actually want out of the business, which is not always what the business is currently built to give you.
Then the important bit. You nominate twelve referees: six customers and six suppliers. Choose them properly. This takes about an hour and it is the hour that determines how useful the research is. Then you let them know I will be calling.
Your time this week: about 90 minutes.
Week 2: The questionnaire
You work through the online Business Analysis Questionnaire. It is 273 questions, roughly 60% about how the business works and 40% hard numbers. It covers you, your sales, your leads and prospects, your competitors, your cost of sales, your gross margins, your team productivity and your overheads.
I will be straight with you. This is the part owners find hard, and it takes four hours or more. Most people tell me afterwards that answering it was the first time in years they had sat down and looked at the whole business in one sitting.
Your time this week: 4 hours or more.
I ring your twelve referees. Six customers, six suppliers. Real conversations, done by me, not outsourced to a call centre or a survey link.
Typically about 80% of what comes back is positive. The other 20% is the gold. It is the stuff nobody says to your face because they like you, or because they do not want the awkward conversation, or because they assume you already know.
Your time this week: none.
Week 3: The market research
Week 4: The analysis
Your numbers go through the calculation engine. It forecasts your profit potential, works out your untapped profit across twelve levers, estimates your enterprise value at exit, and projects the date your business could make you financially free.
At the same time I am reading the market research back against your own answers. The gap between how you see the business and how your customers and suppliers see it is often the single most useful finding in the whole report.
Your time this week: none.
You receive your Business Analysis Report. It runs 120 pages or more. It identifies the profit leaks, quantifies every opportunity in dollars, shows the arithmetic behind each one, and puts them in priority order.
You read it. Give it one to three hours and a quiet morning. Do not skim it.
Your time this week: 1 to 3 hours.
Week 5: The report
Week 6: The interpretation
We sit down for 90 minutes and I take you through it. What it found, what it means, what order to do things in, and which two or three things to start on this month.
That is the end of the engagement. If the report indicates that ongoing coaching would help you action it, I will say so. If it does not, I will say that too.
Your time this week: 90 minutes.
| Step | Your time |
|---|---|
| Sign the NDA | 2 minutes |
| Authorise the investment | 2 minutes |
| Select your twelve referees | 60 minutes |
| Notify your referees | Under 30 minutes |
| Complete the questionnaire | 4 hours or more |
| Read your report | 1 to 3 hours |
| Attend the interpretation | 90 minutes |
| Total | Around 8 to 10 hours over six weeks |
What it costs you in time
Eight to ten hours. For most owners that is a bit over a day, spread across six weeks, to find out what the business is actually doing.
Sample deliverable: the twelve profit levers
This is the centre of the report. Every business gets the same twelve levers examined and a different set of answers, because the leverage points are different in every business.
The twelve are: increase prices, reactivate lapsed customers, generate referrals and testimonials, win new customers, sell more to existing customers, reduce cost of sales, reduce inventory costs, increase team productivity, reduce financial overheads, reduce communication costs, reduce occupancy costs, and eliminate other wastage.
Here is what the output looks like for an illustrative business turning over $1.5M at a 6% net margin, which is $90,000 of profit a year.
| Profit lever | Annual after-tax gain | Six-year compounding value |
|---|---|---|
| 1. Increase prices | $31,500 | $284,200 |
| 2. Reactivate lapsed customers | $6,200 | $55,900 |
| 3. Referrals and testimonials | $9,800 | $88,400 |
| 4. Win new customers | $12,400 | $111,900 |
| 5. Sell more to existing customers | $8,600 | $77,600 |
| 6. Reduce cost of sales | $11,300 | $101,900 |
| 7. Reduce inventory costs | $1,900 | $17,100 |
| 8. Increase team productivity | $7,400 | $66,800 |
| 9. Reduce financial overheads | $2,100 | $18,900 |
| 10. Reduce communication costs | $1,150 | $10,400 |
| 11. Reduce occupancy costs | $2,800 | $25,300 |
| 12. Reduce other overheads | $4,300 | $38,800 |
| Total | $99,450 | $897,200 |
Illustrative figures for a $1.5M business, not a client result. Your report shows your own numbers with the full working behind every line.
Look at the top line. On a business making $90,000 a year, a three percent price rise is worth $31,500. That single row is usually worth more than the whole engagement, and it is the one owners are most frightened of.
Notice too how small some of the rows are. Communication costs at $1,150 is not going to change your life. The report tells you that as well, which is the point. You stop spending Saturday mornings on the things that do not matter.
The guarantee
For businesses turning over $1M or more, the Business Analysis carries a 10 to 1 guarantee. If the report does not identify at least $60,000 in profit currently leaking out of your business, based entirely on your own numbers, you do not pay for it.
Investment: $6,000.
That sits inside the normal Australian range for this kind of work. I have written a full breakdown of what business consultants charge here.
Who this is not for
I would rather tell you now.
If your books are behind. I cannot measure numbers that do not exist. Get twelve clean months from your bookkeeper first.
If you will not nominate real referees. If you are not prepared to have me speak to six customers and six suppliers honestly, the research half of this does not work and you are buying a spreadsheet.
If you already know what is wrong. Go and fix it. Do not buy a diagnosis to postpone a decision you have already made.
If you are in genuine financial distress. If payroll next month is a real question, you need a restructuring specialist this week, not a six-week process.
If you will not act on it. The report is evidence. Someone still has to take responsibility for changing what it points at, and that someone is you.
If you are weighing it up rather than ruling it out, I have written honestly about when an analysis is worth it and when it is not.
Common Questions
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Six weeks from signing to interpretation, assuming you complete the questionnaire in week 2. Owners who let the questionnaire drift are the ones who take ten weeks.
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I need accurate figures, which come from you through the questionnaire. I am not logging into your bank.
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Almost none do. Most are flattered you asked, and several will use it as an opportunity to tell you something useful.
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Nothing, unless the report supports it. If ongoing coaching makes sense, that is a separate decision and a separate conversation.
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Generally yes, as a business expense. Confirm it with your accountant.
Your Next Step
The starting point is a conversation, not a commitment. Fifteen minutes, no report, no pitch. We work out whether a Business Analysis is the right thing for your business or whether something else is.
Call me at 0491 729 043, or book a conversation at sarahcolgate.com.au.