The study's overall goal was to assess the practice and potential challenges that the businessrnconsulting firm is facing, as well as to recognize the root causes of those challenges and to meetrnthe study's objectives. The descriptive research method was applied to find out businessrnconsultancy phases and challenges. To indicate in each Addis Ababa sub-district, a clusterrnsampling technique was used and a purposive sampling approach was applied to determine thernsample size from each of the chosen firms and to classify the sampled respondents. Primary datarnwere collected using structured questionnaires of both open-ended and close-ended questions.rnQuantitative data were analyzed by descriptive statistical tools such as frequency distribution,rnpercentage, mean score, and standard deviation due to the assumption that the sample providesrnthe required information easily. The overall finding and conclusion of the study indicate that thernactivities of each phase seem to be applied and more or less implemented in a sufficient mannerrnhowever, it has incurred challenges internally and externally. The properly unplanned, lack ofrnup-to-date training in terms of low awareness and skilled manpower, client negligence,rnundervalued of the service unethical practice of consultant and lack of transparency andrnaccountability. The study recommends the creation of professional association as being a voicernof the industry, create a fair system in the prevention of corruption. Additionally, providernrealistic training to employees as to acquire new skills set as the business environment is rapidlyrnchanging every day as well as competitors are growing.