Building the Business Model Definition A business model
Building the Business Model
Definition “A business model is a description of how your company intends to create value in the marketplace. It includes that unique combination of products, services, image and distribution that your business carries forward. It also includes the underlying organization of people, and the operational infrastructure that they use to accomplish their work”. distribution t uc pe op s d o pr le Business Model se r e g a vic e Source: Kaplan and Warren (2013) s im infrastructure
The 3 Ms The Business Model combines creativity innovation and entrepreneurship and is based on; • Market demand • Market size and structure • Margin analysis ……is it worth it?
Linking creativity, innovation and entrepreneurship Source: Shaper et al (2013)
Choosing the right Business Model QUESTION: How many different business models can we come up with to generate revenue from a lemonade stall? Source: Adapted from Babson College
Types of Business Model Some examples; • Unit sales • Hire complete service • Rent stall • Franchise • Advertising • Subscription • All you can eat
resh ape Developing the Model n a l p learn experiment
The Business Model Canvas
Developing a Model Business Model Canvas Video
The 9 Building Blocks K ACT EY IVIT IE S K PAR EY TNE RS CUS T SEG OMER MEN TS CHA NNE LS CU REL STOM E ATI ONS R HIP S C STR OST UCT URE Source: Osterwalder et al (2010) RES KEY OUR CES REV STR ENUE EAM S V PRO ALUE POS ITIO N
loca l dair y c as hand h ling pers o nal mus ic staff busi nes rates s face to face s ale o mug f s c om mut ers
Tutorial
Exercise 3. 1: Smooth Juice Thinking about everything we have learned so far; • Review the “Smooth Juice” case study. • What is the product’s “offering”? • Is it real, viable and worth the effort? • How could we improve the product “offering”?
Exercise 3. 2: Understanding the “offering” Using the Business Model Canvas map out the business model for your ideal coffee shop.
Exercise 3. 2: Understanding the “offering” Same 9 components - 4 very different “offerings”
BUSINESS MODEL CANVAS – CRITERIA FOR SUCCESS Key Partners Key Activities FEASIBILITY Value Proposition Customer Relationships DESIRABILITY Key Resources Cost Structure Customer Segments Channels Revenue Streams VIABILITY
Building your own Business Model Now using the Business Model Canvas can you map out your own Business Model for your business idea
References Bygrave, W. , & Zacharakis, A. , (2014), “Entrepreneurship”, 3 rd edition. New York: Wiley. Kaplan J. M. and Warren A. C. , (2013), “Patterns of Entrepreneurship Management”, 4 th Edition, Wiley. Osterwalder, A. , Pigneur, Y. , & Clark, T. (2010). “Business Model Generation: A handbook for visionaries, game changers, and challengers”. Hoboken, NJ: Wiley. Schaper, M. , Volery, T. , Weber, P. , & Gibson, B. (2013). “Entrepreneurship and Small Business: 4 th Asia Pacific Edition”. Milton Qld, Australia: Wiley.
- Slides: 18