Simplifying Business Planning with the Business Model Canvas
Explore a more efficient way to develop your business plan using the Business Model Canvas. Discover the key components, benefits, and importance of strategic planning to enhance your chances of success in the competitive business landscape. Gain insights on why having a solid plan in place is crucial for business longevity and growth, backed by statistics and proven strategies. Embrace a structured approach to identifying opportunities, mitigating risks, and achieving viability for your entrepreneurial ventures.
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An Easier Way to Prepare Your Business Plan The Business Model Canvas
Business Model Canvas Workshop Agenda What is it? Why Use It? Components Helpful resources Question & Answer
Business Model Canvas Finding the path to success
Exercise: Design Your Dream House You ve been saving your money and you want to build your dream house!
Why do I need a plansome sobering numbers Business Start Up Failure Rates1: 21.5% of startups fail in the first year 30% in the second year 50% in the fifth year 1Investopedia 2 Harvard Business Review
Why do I need a planto improve your chance at success! A business plans can help you succeed2 Entrepreneurs who write business plans are 16% more likely to achieve viability than non- planning entrepreneurs. 2 Harvard Business Review
BMC Overview Why Use It?
Business Model Canvas A Preliminary Business Plan Test and validate your business idea Helps identify issues and barriers Do it before risking time and money Work can go into a traditional business plan
Benefits of using the Business Model Canvas process 1. Easy to understand 2. Customer focused 3. Flexible 4. Shows connections 5. Easy to communicate
The Business Model Canvas Explained
What is a business model? Definition1: A company's plan for making a profit. It identifies the products or services the business plans to sell, its identified target market, and any anticipated expenses. It identifies the key drivers that make a business successful It can be a lot of work .but the Business Model Canvas can help
What is the Business Model Canvas? Created by Alexander Osterwalder Strategizer.com A strategic management and lean start-up template for developing new or documenting existing business models It s a visual chart that that answers three questions: 1. Desirability - Do customers want it? 2. Feasibility - Can we build it? 3. Viability Can we make money?
Business Model Canvas Components 1. Customer Segments 2. Value Proposition 3. Channels 4. Customer Relationships 5. Revenue Streams 6. Key Resources 7. Key Activities 8. Key Partnerships 9. Cost Structure
The big picture - question #1: Desirability Do they want it?
1. Customer Segments Understand your major customer targets Determine what they need/want Guiding questions 1. Who are your important customers? 2. What do they say about your business?
1. Customer Segments Uber Business Model Understand your major customer targets Passengers Do not own car Travel for business Convenient service Determine what they need/want Guiding questions Drivers Car owners looking for extra income Car owners looking for a flexible work environment 1. Who are your important customers? 2. What do they say about your business?
2. Value Proposition Describe the value you deliver to each customer segment Explain why they buy from you Guiding questions 1. Why do customers buy from your business? 2. What makes you unique? 3. What value do you deliver? 4. What bundle of offerings do offer to each customer segment?
2. Value Proposition Uber Business Model Describe the value you deliver to each customer segment Passengers Makes it easy to get a ride when I need it Explain why they buy from you Guiding questions Drivers Allows me to be my own boss and work when I want 1. Why do customers buy from your business? 2. What makes you unique? 3. What value do you deliver? 4. What bundle of offerings do offer to each customer segment?
2. Value Proposition Uber Business Model Describe the value you deliver to each customer segment Passengers One tap ordering Real-time tracking Accurate ETA Cashless payment Explain why they buy from you Guiding questions 1. Why do customers buy from your business? 2. What makes you unique? 3. What value do you deliver? 4. What bundle of offerings do offer to each customer segment? Drivers Income Ease of joining Flexible schedule Instant customers Online payment
3. Customer Relationships Describe how you get, keep, and grow your customers Explain how you motivate and impress customers Guiding questions 1. What type of customer relationship does each customer segment expect us to establish and maintain with them? 2. What incentives and rewards are available for customers? 3. How do we integrate these into the rest of our business model?
3. Customer Relationships Uber Business Model Describe how you get, keep, and grow your customers Self service On demand Ease of use Responsive Transparent/Ratings Explain how you motivate and impress customers Guiding questions 1. What type of customer relationship does each customer segment expect us to establish and maintain with them? 2. What incentives and rewards are available for customers? 3. How do we integrate these into the rest of our business model?
4. Channels Describe how you reach your target customers Explain how they become aware of your product/service Guiding questions 1. What channels are used to reach customers? 2. What channels perform the best? 3. What alternatives are available?
4. Channels Uber Business Model Describe how you reach your target customers Explain how they become aware of your product/service Guiding questions Mobile app Social media Word of mouth Online advertising Offline advertising 1. What channels are used to reach customers? 2. What channels perform the best? 3. What alternatives are available?
5. Revenue Streams Describe where the money will come from Explain how you capture value from your customers Guiding questions 1. What are the main revenue sources? 2. What are customers willing to pay? 3. What can be done to increase income?
5. Revenue Streams Uber Business Model Describe where the money will come from Explain how you capture value from your customers Guiding questions 1. What are the main revenue sources? 2. What are customers willing to pay? 3. What can be done to increase income? Ride transaction fee Surge pricing License fees Alternative streams: Uber eats
The big picture - question #2: Feasibility Can you build it?
6. Key Activities Describe the most important strategic things you must do to make business model work? Explain what unique activities are crucial to success Guiding questions 1. What are the main activities to deliver the value proposition? 2. Your channels? 3. Your customer relationships? 4. Your revenue streams?
6. Key Activities Uber Business Model Describe the most important strategic things you must do to make business model work? Platform development Hire drivers Recruit customers Customer support Driver payout Explain what unique activities are crucial to success Guiding questions 1. What are the main activities to deliver the value proposition? 2. Your channels? 3. Your customer relationships? 4. Your revenue streams?
7. Key Resources Describe your most important strategic assets Explain what unique resources you have or need Guiding questions 1. What are the main assets and resources for the value proposition? 2. Your channels? 3. Your customer relationships? 4. Your revenue streams?
7. Key Resources Uber Business Model Describe your most important strategic assets Explain what unique resources you have or need Guiding questions 1. What are the main assets and resources for the value proposition? 2. Your channels? 3. Your customer relationships? 4. Your revenue streams? Technology infrastructure Platform architecture - App Data analysis and AI Branding
8. Key Partners Describe the activities that are important but will be outsourced Explain what unique activities are crucial to success Guiding questions 1. Which resources are acquiring from partners in the market? 2. Who are key partners? 3. Who are key suppliers? 4. What key activities do they perform?
8. Key Partners Uber Business Model Describe the activities that are important but will be outsourced Investors / VCs Google Maps Amazon AWS Technology partner Payment processor API providers Drivers Lobbyists Explain what unique activities are crucial to success Guiding questions 1. Which resources are acquiring from partners in the market? 2. Who are key partners? 3. Who are key suppliers? 4. What key activities do they perform?
9. Cost Structure Describe the key costs and ensure they are aligned with your value proposition Explain if your business is cost driven or value driven Guiding questions 1. What are the business major cost drivers? How are they linked to revenue? 2. What are the main expenses for the business? 3. What resources are most expensive? 4. What activities are most expensive?
9. Cost Structure Uber Business Model Describe the key costs and ensure they are aligned with your value proposition Explain if your business is cost driven or value driven Guiding questions 1. What are the business major cost drivers? How are they linked to revenue? 2. What are the main expenses for the business? 3. What resources are most expensive? 4. What activities are most expensive? Driver payments and insurance Technology development and maintenance Sales and marketing Employee salaries
The big picture - question #3: Viability Can you make money?
Business Model Canvas Summary Business Model Canvas is an easy way to show the key elements of any business model on a single sheet of paper The canvas has nine building blocks to help answers three key questions Through the examples you should be able to see just how easy it is to represent the complex business model of any company on one sheet of paper
Are you interested in using the business model canvas? Online Resources: 1. Business Model Canvas (blank) - Link 2. Alexander Osterwilder BMC Training - Link 3. Strategyzer Training - Link 4. SCORE Self Paced Learning - Link Request a SCORE Mentor: Get free mentoring on your business idea Go to memphis.score.org and click on request a mentor
Questions & Answers
