Every business can be drawn as one tree. A framework is this tree pruned to the client's question: keep the branches that could change the answer, cut the rest, and say where you would start.
The tree
- Market
- Demand: who buys, how much they spend a year, how fast it grows
- Supply: competitors, substitutes, barriers to entry
- External: regulation, the economy, society, technology
- Existing business: revenue
- For each product or service: price (list price, discounts, mix across tiers, price against competitors, what customers will pay) × quantity (customers, how often they buy, units per purchase, customers kept versus lost, capacity)
- Mix: the share of revenue from each product or service
- Existing business: cost
- Variable, for each product or service: materials or inputs per unit, labor per unit, delivery, payment fees
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