Business model compare

How business model 2 make profit?

Your customers make profit from offering processing services for other industries’ products,and you make profit from charging them for renting and waste-water treatment.Most of our customers are small business,for example,some of them want to control the quality by themselves,some of them do not have license to make manufacturing legally,some of them just want to rent a small workshop for their products.Small business have to rent your workshops or they will be caught because they do not have license.

Advantage and disadvantage:

1. Less investment (You do not need to buy manufacturing equipment and employee manufacturing staff because your customer will do it)

2. Less Running cost(There is no market department and manufacturing department in your company)

3. Better cash flow and less fiance risk,you can get payment from your customers will be much easy.Your customers pay you monthly,Instead of get payment after order finished.You can also stop electricity supply if your customers do not clean the overdraft(Money owed to you) to you.You can also sell their manufacturing equipment as reparation which is included in the agreement so you can get low fiance risk and better cash flow management for running this business.

4. Processing is complex.You need processing technology and management experience.Think about Zara，apple outsource their manufacturing department？Explain why these companies do not want to take the risk of manufacturing?Maybe cost control?

Disadvantage：

Your charging for renting and waster treatment are fixed.which means your profits is stable.Because you do not participate the manufacturing process so there is no risk to lose money caused by bad marketing price，which also means you lose the opportunity to make more money caused by good marketing price.

Requirement：

1. Describe this business model.Who is your customers？Why most of them are small business？Because big company will not outsource his processing as they want to control the business running ever outsource will be cheaper.In this business model,You share your risk with your customers and you do not need to do anything about manufacturing,so,what you do is offering renting services for these small business.Why these small business want rent your workshops?What are the disadvantages and advantages of this risk-share business model？Compare Business model 1.0 and Business model 2.0。(800)

2. Are there any other polluting industries use this business model？For example，Printing，paper-making，petrochemical plant.What kind of innovation they did and does these innovation works？If works，can we use these innovation in metal -coating industry？What are the impact of government policy and market trend to these polluting industry?for example,increased cost.(500)

3.Draw a business model canvas for it.