How To Build a Better Business Model Canvas
Ever wondered why most businesses fail at an early stage? Almost 90% of startups fail within six months of operation. Any idea of why the stats stand like that?
You may think your business is moving but literally failing inside out. Most Startups businesses have faced a big failure even before they are known.
You can imagine how frustrating business failures are at any level. It can be big corporations either public or private ones. At the end it is more stressful to see all hard work going in vain.
Today I am going to highlight key things to help you build a better business model Canvas. Lots of business people care less about the importance to the business canvas, hence leading to business failures.
What is a Business Model Canvas
A business Model Canvas is a representation of the business activities throughout operations, it helps to visualize, assess, build or model a business in a strategic way.
Business Model was first discovered by Alexander Osterwalder, a Swiss business theorist, author, speaker, consultant, and entrepreneur
How to Build a Successful Business Model Canvas
Building or creating a successful Business Model Canvas takes a lot of time and thinking ahead within the business arena you want to base on.
The industry you want to build on is a masterpiece towards building a successful business Model. In modeling your business you need to consider or explore the 9 building blocks of a business Model Canvas.
Here are the 9 Building Blocks of a Business Model Canvas explained.
Exploring the Market
Before anything you should ask yourself do I have a market for my product or service in question? That should give you a strategic hint on what is the available market niche for my product or service.
You may use different means to find out the market space of your product or service. Make the use of google and social media.
You simply have to type in google your question and see what's popping up on search results. For Example, if you want to start selling cakes, just search for the best cake that will give you a clue on what people are searching for.
From there you will see different search results which will help you to improve or determine what kind of cake Business you are venturing into based on what people are looking for. If you answer those questions in your product or service then you will for sure secure a market space.
Value Proposition
Any business needs to have value to its customers. Having failed to offer a required value you will not make projected sales hence knocked out in the market competition.
Value proposition is one of the parts of business which is underestimated. A few business people take it seriously. That alone is a disaster as it leads to lots of business failures.
Adding value to your business is so tricky but can be done. You should respect the market you are venturing into.
The values of the customers or clients should not be taken for granted. Try to search for what people are talking about that product or service in the industry.
You can look for amazon Reviews on that particular product of which you will see the area of improvements. People talk and you should embrace them well. The reviews customers write on a product should guide you on what is needed and how they want it.
You may even contact them for suggestions on a product. That will give you a gap to solve within existing products or new ones hence adding value to that.
The fact of the matter is that you should outstand the competitors in a market segment.
Channel of Distribution
Yes you have developed a product or created a service but how are you going to reach the customers within a market niche? That question should pop up in whatever you do.
Communication is very important in business to keep business up and running. How your company strategizes on the communication is a key to making more sales.
You have to have proper delivery services to your customer segments.
Customer Relationships
You can have a good product or a service but with no proper channels of distribution it can yield nothing. In a digital world you can use digital means to reach out to customers unlike traditional means. For example, phone call, Email, social media and more
You should draft a way forward on how you are going to keep customers coming for the second time as that proves first certifications. Make sure you sell as long as it takes.
Revenue Streams
There is no business if you are not making sales. Your first mile in business is to make a single sale then second which guarantees more sales.
No business can stay operating with no sales so make sure you bring in revenues or/and returns to the business as that keeps the business survival life span.
There is no miracle to turn around if the business is not bringing revenues so make sure you add value to customers to make sales. It's very difficult but can be done.
Key resources
Do you have the resources to run a business? Then you are good to go, before starting a business make sure you have required resources that determine the delivery of the business on the ground.
These are assets which count for the company such as human resources, Physical resources, Intellectual resources and more. The combination of these makes a company up and running.
No company can operate without workers which will in turn make informed decisions on a regular basis.
Key Activities
What is your company intended to do? That helps to answer on what will be the activities of the company to manage its operations.
Who does what and it should be done are some aspects to look into. Make sure there is a clear division of activities within the working framework. That helps to make sure that the company is kept on track.
Key Partnership
By any means you need strategic partners to work with you in business delivery service. You cannot manage to hold all activities of the companies without having a formidable partnership.
Let's say you run a cake business of which you need a delivery service of which you don't have a truck to channel to your customers. That is where you will need a strategic partnership with a car delivery company to help you deliver the product.
The terms and conditions should be of mutual interest whenever you are agreeing on a partnership deal.
Cost Structure
Business has costs at all stages and you need to make sure you are aware of the costs associated with the business you are venturing into. Failing to do so will jeopardize your business future.
The costs of the business should be accountable for in bookkeeping that helps to calculate well on the revenue generations after product or service sale. Make sure you are in the right expenditures as that will help you to generate more.
At an early stage of business you must at all cost avoid unnecessary costs as that helps to balance up the business and keep it running smoothly.
Conclusion
Business Modelling is a key to the success of your business. Make sure you have it before anything else as that will help to strategically boost your business. It offers a business sustainability as you can project all operations of the business in one piece.
It summarizes all understandings of the business of your choice as it applies to all business sectors.
What do you think about the business model canvas? Bad Idea or good one? Have you tried it before and what was the experience like? If not, what works for you according to this blog?
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