“As we all know for starting any Business, a proper Business plan is crucial. But there is one catch in it, for planning a business there is
not a universal template which every business can follow, because planning
& strategizing a business depends on the product & service you want to offer.
So here comes “Business Model canvas” which is universally applicable for
business planning.
The best thing is anybody can draw their business plan in a
A2 size piece of paper (although the size of paper is not specified but we actually
need at least this size of paper to plan write our business plan).
“A business model describes the rationale of how an organization creates, delivers, and captures value”
BUSINESS MODEL CANVAS:
It is the
visual representation of the various elements of your Business Model.
There are
basically 9 building block:
Now, Inorder to creat Business Model for your Idea or recreating model for your Business , you need to ask couple of Question related to each segment & Write your answer down to below mentioned Business model canvas :
1. CUSTOMER SEGMENT:
Different Types:
Mass Market, Niche Market, Segmented, Diversified, Multi-side Platforms
- Who are your most important customers?
- For whom are we creating value?
- You must create a detailed portrait of each (“archetype”)
2. VALUE
PROPOSITION
Bundle of
products or services that create value for specific Customer Segment:
Element
Contribute to value creation: Newness, Performance, Customization
- What is their PAIN? (B2B) or their ACHE? (B2C)
- Which one of the customer’s problem are we helping to solve?
- What value do we deliver to the customer?
3. DUSTRIBUTION CHANNELS
How do you
deliver this value at every stage of the buying process?
Types :
Direct & Indirect
- Through Which channel our customer segments want to be reached?
- How are we reaching them now?
4. CUSTOMER
RELATIONSHIPS
Categories:
Personal assistance, Dedicated assistance, Self-service, Automated service
- How do you GET, KEEP, and GROW your customer base?
- How do you build a loyal and enthusiastic tribe around your offer?
5. REVENUE STREAMS
Way to generate revenue: Usage fee, subscription fees,
Lending/Renting/Leasing, Licensing
- What VALUE are customers willing to pay for?
- For what do they currently pay?
- What are the pricing tactics?
- What is revenue model?
Where can you generate revenue that others leave on the
table?
6. KEY RESOURCES
(Tools, space, locations, Human (qualifications, in-house or sub), equipment
(lease or buy), licenses, intellectual property, supplies ,financial
requirements)
- What infrastructure and resources do we need for our Business?
- What Key resources do our value proposition require?
7. KEY ACTIVITY
Production, Problem
solving, Networking/Platform, dependencies, responsibilities
- What are the key activities do our value propositions require?
- What key activity our distribution channels require?
8.KEY PARTNERS
Partners, Suppliers,
Developers, Distributors, Investors, Collaborators, Affiliates, Competitors, Alternatives
- How does each partner help or hinder the business model?
- Who are Our Key partners?
9. COST STRUCTURE
All costs incurred to operate a business model (cost driven, value
driven)
- What are the critical elements of the cost structure?
Fixed costs,
Variable costs, Resource, activity, partner costs, Infrastructure, operational,
cost of sales, Payroll costs, benefits, bonus structure, taxes
- What are the costs of each element of the business model?
- Where are the economies of scale?
- What are the risks, the unknowns ?
Validating
the Canvas
The
problem is that startups fall in love with the solution too early.
They don't
focus enough on the foundation of vision and strategy to make sure it connects
to what people want and use.
Everything
on you put on your canvas is a HYPOTHESIS.
You must VALIDATE
every element through -
Discovery (your own data)
Research (other people’s data)
Testing (simulation)
To uncover
the DISRUPT.
