Business Model Canvas For Small Business Strategy

By | January 7, 2015

Through this post, we’ll show you how to create simple business strategy with using Business Model Canvas.

Business model describes overall process how an organization creates, delivers, and captures value. It has been tested and applied in many companies such as: Ericsson, IBM, etc.

The business model consists of 9 components which includes 4 key areas within a business: customers, supply, infrastructure, and financial viability. It is like a blueprint strategy implemented through organizational structures, processes, and systems.

Let’s discuss it one by one briefly. I’ll give you some illustrations to make it easier.

1. Customer Segments

customer segments

This component describes a group of people we want to reach by our business. Ask: to whom we make our products/services? Who is the most important customers?

2. Value Proposition

Value Proposition

What value would we provide to customers? Among the several issues of the customers, which issues we help to solve? Or which customer needs we’ll try to fulfil? What combination of products and services we can offer to each segment?

3. Channels

Channels

This component helps us to think about how we can communicate and reach out our customer segment to deliver our Value Propositions. Through which channels they want to be reached? Which channel that most efficient? How do we integrate these channels with the habits of customers?

4. Customer Relationships

Customer Relationships

Which type of relationship is expected by each segment of our customer? Could it be done through personal relationships? Or through the communities?

5. Revenue Streams

Revenue Streams

What are the value that customers really want to pay? From where we can get the revenue? How do they pay? How about price-setting mechanism?

6. Key Resources

Key Resources

What are the main resources that we need to support our Value Proposition? What are the main resources that we need to support our distribution channels? To support our Customer Relationships? The main resources are usually required to support the business components are: human, intellectual, physical, and financial.

7. Key Activities

Key Activities

What are the key activities required to support our Value Proposition? Our Distribution Channels? Our Customer Relationships?

8. Key Partnerships

Key Partnerships

Who are our main partners? Who are our main suppliers? What Key Resources can we get from our partners? What Key Activities can be done by our partners?

9. Cost Structure

Cost Structure

How much cost we must spend to our business model? Which key resource takes the cost? Which key activity takes the cost?

Now, let’s compile them. We’ll get overall business strategy like this.

Interestingly, it can be started from any component since they are relate to each other. We don’t have to start with Customer Segments first. Even we can write down how much revenue we want to earn in the beginning of the process. Just let it flow. Good luck!

(Visited 379 times, 1 visits today)

Leave a Reply

Your email address will not be published. Required fields are marked *