Business Review Questionnaire

For use when reviewing a business to improve the profits

Organization – the right people in the right roles

• Do you have an organization chart?
  • If so – provide a copy
  • If not –
    • How many people do you employ?
    • What roles do they fill?
    • To whom do they report?
    • PMI – create an org chart
  • Which are salary and which are wage earners?
  • Which are part-time and which are full-time?
  • Do any get paid based only on billable time?
  • Who does billing?
  • Who does payroll?
• Do you and your supervisors conduct routine performance reviews?
  • How often?
  • By whom?
  • What results from the review?
• Do you review / adjust salaries or wages?
  • How often?
  • What factors do you consider?
  • Do you provide benefits?
    • What type of benefits?
    • To whom?
  • Do you award bonuses?
    • What factors do you consider?
    • Who is eligible?
    • How much has been awarded in the last 3 years?

Key Drivers – focus on the important issues

The answers to these will be different for each business – shown here are examples.

• Purpose of the business – probably one of the following
  • To make money for the business
  • To make money for the owner
  • To make money for the employees
• Key Drivers of Profitability
  • Compliance
    • Permits
    • Taxes
      • Social security
      • Income
      • Sales
    • Contracts
    • OSHA
      • PSM
      • OSHA forms
      • Equipment
    • Vehicles
      • Registration
      • Driver’s Licenses
      • Insurance
  • Safety
  • Quality
    • Cost effective
    • Productive
    • Minimal re-work
    • Appearance of product
  • Production (calculate profit margin and revenues in each area)
    • Billable hours – minimize non-billable payroll time
      • Owner
      • Employees
    • Rentals
    • Sales
  • Marketing
    • Networking
    • Advertising
    • Web site
• How much time is spent on other than the above key drivers?
  • Why? – Was a key driver missed?
  • How can non-key driver time be reduced?

Financials – optimum use of money and credit

• Gross revenue
• Expenses
  • Insurance
  • Interest
  • Fuel
  • Salaries and wages
  • Taxes
  • Supplies
• Debt
• EBITDA – Earnings before income tax depreciation amortization
• Net profits

Efficiencies – minimizing the costs

• Information gathering
  • Who does the billing?
  • Who does payroll?
  • What is the percent of billable time versus non-billable time for each employee?
  • Do you bill for all billable time?
  • How do you manage the timesheets?
  • How do you track and manage the invoices?
  • How much value is lost in un-paid invoices?
  • List the loans and interest rates?
• Possible earnings or savings
  • Pay off the loans (starting with the highest interest rate loans)
  • Reduce the interest on existing loans
  • Stop rentals and purchase equipment where economical
  • Sell unused equipment
  • Start renting for seldom used equipment
  • Invoice all billable hours
  • Collect unpaid invoices
  • Write-off those that aren’t paid (must make effort to collect)
  • Evaluate the business structure for better tax treatment
  • Put idle money to work
  • Reduce the number of non-billable employees
  • Use of automation and technical tools such as computers
  • Reduce overhead
    • Fuel
    • Power
    • Equipment
    • Employee benefits
      • health insurance
      • vehicles
      • cell phones
  • Consider selling the business

  Exit strategy – maximizing the value of the business

  • How is your business structured?
    • Sole Proprietor
    • Corporation
    • S-Corporation
    • Limited Liability Company
    • Partnership
  • What has been the profit growth rate over the last 3 years?
  • What is the net worth of the business?
  • What is the market value of the business?