A company makes money thanks to its business model. This rather abstract concept depends on many elements, specific to the company and the project, but which all have interactions with each other. One tool allows entrepreneurs who want to find the right “business model”, that is the one that will allow them to be successful: it is the business model canvas (BMC). This is what this process is all about.
The business model canvas, what exactly is it?
the business template canvas is a tool that allows you to define and then represent the economic model of your company. The process leads to the production of a concise document (held on a single page) that describes exactly how you will earn from your business project.
In practice, there are many BMC methods. The best known is the one theorized by Alexander Osterwalder and Yves Pigneur in their book entitled “New Generation Business Model”. It has the advantage of being easy to understand, quick to implement and visual: it only takes a few minutes to understand the project.
The building blocks of the business model canvas
A business canvas model is built around nine fundamental elements:
• Customer segments (exact target of your offer)
• The value proposition (characteristics of your offer of goods or services)
• The distribution and communication channels (means used to sell your offer)
• The relationship with the customer (interactions with your customers before, during and after the purchase)
• Income (money generated by your business)
• Key resources (resources needed to produce an offer that meets expectations)
• Key activities (the most important activities to master to be successful)
• Key partners (business allies: suppliers, subcontractors, specifiers, etc.)
• The cost structure (list and evaluation of fixed and variable costs)
Building a BMC: where to start and how to proceed?
One of the main advantages of the method lies in the simplicity of implementation (technical means and costs). In fact, a simple sheet of paper is enough to make a BMC. Some use sticky notes that stick to a wall or computer spreadsheets.
To fill it in, use short texts. Take your time on each block and never neglect the interactions between all the elements. Any changes made to a block affect the rest of the table …
You have to do this work with your team but not be alone. After completing a first draft of BMC, analyze it and submit it for opinion to external eyes (potential customers, friends, family, etc.).
To be able to formulate the right strategy, you can correct the document as often as necessary. Once you have created your business and launched your business, use this media to compare your results with forecasts.
(Photo credit: iStock)
Article written by
This text is published under the responsibility of its author. Its contents do not in any way commit the editorial staff of Les Echos Solutions.