Top 5 Elements of a Good Business Model
12/09/2022
Creating a business model is extremely useful not only if you’re looking to sell your business, but also when starting a new business or looking at ways of developing your company further.
Business models can establish the strengths and weaknesses of your company or new business idea, evaluating how your business will progress in future and showing potential investors what your brand contains and how it will continue to succeed.
Continue reading to find out the top 5 elements of a good business model…
1. Identify a Target Audience
Identifying your target audience is a key part of a good business model, as it will show that you have a clear view of the demographic you want to appeal to and how you will develop and grow your products to match the needs of the audience.
When identifying a target audience, keep their age, interests, hobbies and how your products/services will relate to all of the above in mind.
If there is a ‘gap in the market’ for your target audience and your business fills that gap, it shows that there is plenty of potential for your business and allows you to tailor your services accordingly.
2. Establish Strong Partner Connections
All successful businesses need strong partner connections to continue succeeding – so it’s important to outline those within your business model.
Key partners such as suppliers, wholesalers, freight forwarders, shipping connections and other partners are all a main part of running your business as smooth as possible.
Are there important connections you have established throughout the years? Or valuable suppliers that offer you exclusive prices/stock?
Don’t forget to include them all!
3. Business Resources
There are plenty of resources within a business that act as key assets – these are a great addition to your business model.
Having a fully functioning website, booking system or page shows that your business can be easily found and accessed, also including social media channels such as Instagram and Facebook and the number of followers/reviews that your company has will show brilliant development opportunities.
Business resources can also include warehouses, storage units and more.
4. Analyse Competitors
Knowing your market and those within that you are continuously competing with are fantastic factors to include within your business model.
Who are your competitors, what do they do differently to your business, and is there anything that you think your competitors are doing that you should look at investing in?
By looking at the pricing, products and services of your competitors, it gives your business an advantage of knowing where to adapt and stay one step ahead.
5. Growth Opportunities
Determining strong growth opportunities are very valuable factors when pitching to an investor or a potential business buyer, or including these for your own benefit when revamping the business.
Including potential campaigns, staff growth, marketing strategies and product development are a couple of growth opportunities that you could adapt to your business and include within your model.
Growth opportunities should outline how your business may be developed in the future and include any investment requirements that would be needed to launch the development.
When developing a business model it’s essential to keep the previously mentioned factors in mind, as a business model will aid in developing an initial business idea, or a business that needs a revamp.
Including your target audience and analysing business resources ensures that your company assets don’t go unrecognised.
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