Business model Canvas is a template that helps to develop a new business plan/ strategy for new companies and also helps existing Companies to restricted their Business Model.
Before you start your business you have to build your business plan you can also call it strategy. A plan or proper framework gives you a clear path.
you can understand what are your offerings are and how you going add them value and earn revenue itself.
What’s in it for me?
- What is the business model canvas? And Template
- Key components of the Business model
- Step by step processes to create a business model
- Best Example of business model canvas
- How to test your business model
- Pros and cons
- Conclusion
- FAQs
Let’s dig deep into it:
If you are planning to start your own business or you are already in Business. Please do read this blog till the end, we will cover up how you can build your new business strategy or restructure your existing business model.
What is the business model canvas? And Template.
A business model has lots of different things like value proposition, Customer segments, Customer relationship, revenue model, you need to develop a business model according to these, now what business model canvas do?
It’s basically a template which has all these things in it, in a very structured way, you can use these template to develop your full phase business model step by step. It’s the greatest tool ever for every Businessman and Entrepreneurs out there.
Here is the template:
Have a close look on this template. Each box(point) is Important for your business model.
We will discuss each point in this blog , So keep reading.
Key components of Business model
Here are 9 components of business model , each component is equal to understand to develop a Perfect Business Model:
- Customer segments
- Value Proposition
- Customer relationship
- Revenue Model
- Channels
- The Key partners
- Key activities
- Key resources
- Cost structure
Step by step processes to create a business model
Step 1: Understand your customer ( Customers segmentation)
This is the first step in the Business model canvas template. This Is all about who are your potential customers. Every product has its own Customer base. For example, Apple I phones are not for lower-income groups, lipstick is not for boys ;). And how big much your customer base?
Step 2: What value you are providing? ( Value Proposition)
What problem you are going to solve your customer and how. This telling you to what problem or need you are going solve and full fill through your product/service.
For example – let’s say you found out there is not restaurant near your house and Peoples are struggling to get their meal. ( This is the problem) .
Now you decided to open a restaurant or food stall to solve that problem, this Is called value proposition and another thing is how are you going to do it?
Maybe you offer tables to sit, good quality food these all come under Value proposition.
Step 3: What about Customers Relationship? (Customer Relationship).
How you will maintain a quality Relationship with your customers, what people should know about you?
What’s that key strategy that will drive your sales?
For example; – Again lets take Apple example, Now think what’s the first thing that comes in your mind after hearing Apple company?
Ya, of course, Expensive and solid quality.
This is the apples way to build relationships with their customers. People who love expensive things they always feel that apple is for me.
Step 4: What are the ways you will generate revenue?
subscription-selling product/ service, subscription-based ore pay peruse? There are different revenue models .you need to find different ways of generating revenue.
For example, let’s say you are running a salon in your local area, now what revenue models you can apply to it?
first, you can charge for hair cuts, facials, and other stuff, and also maybe you use a hair cut package strategy like you will give 6 hair cuts at a specific amount with the limited time period, maybe a subscription for facial and hair cut combine.
Step 5: Channels
For example, you made A application to solve a particular problem now customers can use that app in this case that app is your Channel. You are delivering a solution through that app.
Step 6: Key partners
Let’s take an example of App, develop need a developer to develop the app, in this case, the developer is your partner to deliver that solution.
Step 7:Key activities
For example, if you are operating, through A app then Application Maintainance, marketing will be the key activities.
Just like that, you need to find what’s your key activities in business. May be trading with Vendors and enterprises will your key activity.
Step 8: What’s the Key resource what is need?
Step 9: Cost structure
You can follow these 9 steps to develop your business model.
Best Example of a business model Canvas
Here is best example of business model canvas template
OYO Business Model:
You can see the OYO Business model canvas template to analyze how the Business Model Canvas Template looks like for real companies.
How to test your business model?
It’s simple, just develop a business model and execute it on your business and look its property working for you or not, if you don’t find any growth then keep changing it until you get your perfect one.
Pros and cons
| Pros | Cons |
|---|---|
| You can change it easily Easy to understand for everyone Very quick to create Already proven way Prefer by experienced entrepreneurs | Very simple not in-depth Not focus on liquidity and Competition. Not often updated |
Conclusion
To use this business model canvas you need to understand each box of Business Model Canvas in a deep. So put all your Research and start writing one by one according to your business. This canvas preferred by experienced entrepreneurs and Businesses man so you can implement it without any hesitation.
That’s it for this blog
Thanks for reading this I will see you in next Blog .
Frequently Asked Questions
Can i Apply Business Model Canvas in Every Business?
Who created the business model canvas?
The Business Model Canvas was developed by the Swiss business model guru Alexander Osterwalder and management Information Systems professor Yves Pigneur.
When was the business model canvas created?
Business Model Canvas was initially proposed in 2005 by Alexander Osterwalder based on his earlier work on business model ontology
Is it Mandatory to Use Business Model Canvas?
This Tool is quite Popular, Almost Every business and Entrepreneurs Applying it into their Business.
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