Complete guide to conducting an audit step by step for your online business: read the article and learn more about how to audit a business.
No matter who you are - the owner of successful e-commerce business or a potential buyer of the same, you need to be sure that the business you own or plan to acquire is performing efficiently, and has a positive tendency to consistent growth. No matter how smoothly, from your perspective, you’ve tuned sales processes on your website, how deeply you’ve researched Search engine optimization and implemented it on the home page, there is always room for improvement.
If you want to be sure of the excellence of your store’s key business metrics and achieve the best client experience, thus adding value to your business, it’s a good idea to audit it. You might be surprised by the results. An audit may show numerous sales opportunities you’re missing and further directions to enhance your sales strategy and processes to make your business even more profitable.
What Is a Business Audit of an Ecommerce Store?
When we’re talking about the term “Business Audit”, one generally means conducting a legal, financial, and tax inspection of your business. In e-commerce, the audit also includes analysis of all key business metrics showing how your products perform, website SEO, conversion rates optimization, backlink building, etc.
Before an investor makes a decision whether theyare going to invest money in a particular store or Amazon company, sign legal documents, and close the deal, they will always start with an e-commerce business audit. Online business audit includes the company’s valuation and performing due diligence. The former is needed to analyze business efficiency, profitability, scalability, and growth potential, as well as to estimate the price you are going to offer to the seller. The latter is required to estimate Amazon account health, risks, analysis of its financials, and position on the market.
When it comes to Amazon FBA business, the major indicators reviewed are related to the Amazon seller account health, profitability, ranking, performance of the ASINs, net profit, inventory turnover levels, PPC spends (ACOS / TACOS), and COGS margins.
On basis of the comprehensive audit results, you take a decision whether you are interested in buying this or that business, and will provide a seller with the offer and price proposal.
Why Conduct an Ecommerce Audit?
Audits help business owners and potential buyers to get a professional overview of the performance of the business, detailed insights into sales processes and potential risks.
Here are 5 reasons why you need an Ecommerce Audit
#1. Review business’s health and economy
A business’s health is not only profitability or efficiency. Today, a lot of attention is paid to customer satisfaction, as well as optimization of sales processes. You need to monitor the business’s BSR history, profit analytics, inventory rate, perform review cheating checkup, refund rate, keyword ranking, etc. An audit will show you all these parameters.
#2. Business growth trends
When your business grows, you need to verify its dynamics, i.e. in which direction it develops and whether you’re happy with it. You need to find out potential risks, bottlenecks, discover the underlying issues where you can make improvements. An audit will give you a “post-sale blueprint” – directions to optimize your business.
#3. Competitive advantage
Verifying your business and marketing strategies and making them more efficient gives you a competitive edge. You will stay on top of the competition being informed about the best way of organizing your sales and marketing.
#4. Know real business’s value
It is always good to know how much is your business worth. The real value of an e-commerce business is influenced by the age and consistency of the business; the business’s net profit; the type of business; etc. If you want to receive a qualified valuation about how much the business is worth, it’s better to address an audit company. You may think about selling your business one day, and though buyers always perform their own customer audit, you will know the preliminary value.
#5. Check customer experience interactions
A customer experience (CX) audit is necessary to assess your target audience’s interactions with your business. It analyzes key touchpoints of your customer's shopping journey, influencing the purchase decision and conversions. CX audit will show how smoothly the process works.
How to Audit a Business?
There are specific standards as to how to perform the audit. An audit is performed by an authorized person or a company, having specific knowledge in the financial and legal area, as well as in the industry, as far as e-commerce business differs from other businesses with regard to valuation criteria.
How to Conduct an Audit Step by Step?
Audit embraces monitoring of all aspects related to your business and further recommendations on how to improve it.
Step 1. Monitoring
On Amazon, all key product metrics of the Seller Central account are reviewed: high performing and low performing ASINs, listing and account health, sales conversions ratio, best seller rank percentage, campaign performance, inventory management history, etc.
With Sage Audit, you don’t need to integrate your seller account, only an Amazon store link is needed.
Step 2. Analysis
All essential business indicators are analyzed. SageAudit analyzes the business’s BSR history, profit analytics, inventory rate, perform review cheating checkup, refund rate, keyword ranking, etc.
Step 3. Report
All business analytics is shown in the charts and visual dashboards. You can see overall trends of your store and statistics down to each and every ASIN.
What are Sage Audit’s Advantages?
There is no need for complicated Seller Central account integration. We need only the link to your Amazon store.
Here’s how it’s done:
Agreement signature (Service agreement is concluded) > Report received (we send you valuation report) > Payment sent (you pay for the report upon reception).
The overall audit takes 24 to 72 hours, depending on the complexity and number of stores.
It’s All you Need:
What do we analyze:
Sustainability of Best Seller Rank dynamics: timing and fluctuations are shown in the chart for each ASIN by date.
Key sales metrics analyzed for business as a whole and for each SKU. Net Profit, Margin, ROI, Sales Revenue, etc. are shown in the visual Profit Dashboard.
Stock status over the last year: inventory age and quantities are shown in the chart for the stock as a whole and each SKU by date.
Review history and authenticity: origin and quality of the reviews are shown in the chart for each ASIN by date and quantity.
Refund analytics: quantity and reason of refunds are shown in the pie or bar chart for the store as a whole and each ASIN, with a refund rate %.
Product keyword ranking: keyword ranks are shown in the table for each ASIN and key.
We offer three packages:
Inventory Rate + Review Cheating + BSR History + Keyword Position
Term: 24 hours
Inventory Rate + Review Cheating + BSR History + Keyword Position + Profit Analytics + Refund Rate
Term: 72 hours
All in-depth analytical information down to each ASIN
Term: 72 hours.