Create a powerpoint with 16 slides

Professor Roblyn Simeon [email protected]

IdeaIdea OpportunityOpportunity

Business Plan

Business Plan

What? What? + How?

Business Model Canvas

Opportunity: What? • What is the real need/problem?

• What market/customers are we after?

• What value is added?

Business Plan & Model Canvas: What & How?

• How are the need addressed

• How do we target/serve our market/customers?

• How the value is added?

BUSINESS MODEL CANVAS: ALTERNATIVE APPROACH

• Visual language for business planning • Describe the main business block of a

business model • Allows continuous testing of

ideas/hypotheses (do not have to continuously re-write a business plan)

• Shows a BIG PICTURE – ROADMAP for business

BUSINESS MODEL CANVAS: 9 COMPONENTS

http://www.youtube.com/watch?v=QoAOzMTLP5s

1. VALUE PROPOSITION

• What is (are) the customers’ problem(s)?

• How do you solve the problem(s)? - Convenience (e.g., fast free delivery of shoes) - Performance (e.g., faster and smaller processor) - Brand/Status (e.g., become a part of an exclusive club) - Cost reduction (e.g., free online telephone calls) - Etc.

• Describes the value your product and service (e.g., features, product life, customer support, etc.).

• How can you or how did they solve the problem better than your competitors? - Understand your competitors - Substitutes they are offering

2. CUSTOMER SEGMENTS

• Describe your customer segments or segment

• Who needs your product the most and will pay for it? • location (e.g., U.S., Nigeria) • Industry or demographics • characteristics and trends

• Market/industry Description • market size • market growth rate • market structure (e.g., fragmented, consolidated, etc.) • Market share attainable

3. CHANNELS

How a company communicates and reaches its customers? • Raising awareness among customers • Helping a customer make a purchase decision • Purchase • Delivery • After sales support

4. CUSTOMER RELATIONSHIPS

Type of relationships a company wants to establish with the customers:

• Personal

• Self-service

• Communities (e.g., AVON)

• Co-creation (e.g., YouTube)

5. KEY RESOURCES

Most important assets to make value

- Physical

- Intellectual

- Human

- Financial

6. KEY ACTIVITIES

Most important actions an organization must make to operate successfully (think distinctive competencies, value chain)

- Production

- Outsourcing, Import/Export

- Recruiting, Training, Retaining

- Market analysis & Marketing

- Supply Chain Management

- Software design

- R&D

7. KEY PARTNERSHIPS

Describe the key network of suppliers, distributors, strategic alliances, joint ventures, etc.

Motivations for partnerships - Optimization and economies of scale - Acquisition of particular resources - Strengthening brand - Reducing risk and uncertainty

8. REVENUE STREAMS

Cash that the company generates from each Customer Segment

Revenue Streams • Asset sale • Usage fee • Subscription fee • Licensing / Franchising • Leasing/Renting/Lending • Advertising • Brokerage fee

Pricing Mechanisms

• Fixed Pricing  List Price  Feature Dependent  Customer segment

dependent  Volume dependent

• Dynamic Pricing  Bargaining (RFP)  Real-time Market

9. COST STRUCTURE

• Cost associated with creating value for customers

• Can be calculated easily after defining Key Resources, Key Activities, and Key Partnerships • Fixed costs (physical manufacturing facilities,

rent, etc.) • Variable costs (marketing, insurance, etc.)

Different for Value-Driven vs. Cost-Driven companies

Source: Starbucks 2013 Annual Report

BUSINESS MODEL CANVAS

BUSINESS MODEL CANVAS

Offer CustomersInfrastructure

Financial Viability

BUSINESS MODEL CANVAS & YOUR BUSINESS PLAN

2. Problem 3. Solution 4. Business Model 5. Underlying Magic

2. Problem 3. Solution 4. Business Model 5. Underlying Magic

Offer

6. Market Analysis and Marketing

7. Industry and competitor analysis

6. Market Analysis and Marketing

7. Industry and competitor analysis

Customers

8. Management Team and Company Structure

9. Schedule and Key Activities

8. Management Team and Company Structure

9. Schedule and Key Activities

Infrastructure

10. Financial Projections10. Financial Projections Financial Viability

1. Executive Summary

The End