How to prepare your business model

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When you come up with a new idea , you may think that it can be easily converted into a successful business , but in fact you can’t say that until you manage to create your business model.

In this post I will try to talk about how you can create your business model. I prepared  this topic through “The business Model Canvas ” book. It is a small book but really you should read it.

A business model describes the rationale of how an organization creates , delivers and captures value.

The business model is like a blueprint for a strategy to be implemented through organizational structures, processes, and systems.

Our business model will be consisted from 9 blocks so I will try to give you short note about each block.

1- Customer Segment : it defines the type of customers that your business or product try to target.

2- Value Proposition : What is the value that your product or service  gives to customer ?

3- Channel : How would your product reach the target customer and how he would know about it ?

4- Customer Relationship : The relationship between you (Company) and the customers.

5- Revenue Streams : How would you get (not earn) the money  ? For what value are your customers willing to pay ?

Note : To calculate the earnings , simply subtract the costs from the revenue .

6- Key Resources : What is the main source of power in your business ? Does your business (ex : Hotel )  depends on owning a very fascinating location that will help you in attracting customers.

7- Key Activities : What are the activities that your company should do to make the business model work perfectly?

8- Key Partnership : Are you looking for a partner that would provide you with a something that will help you in making your business model work ?

9-  Cost Structure : It describes all costs incurred to operate the business model.

Note : When you calculate the cost structure , don’t forget the salaries of you and other team members.

– If you would know more about the each block you can check them in the book as I said before.

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This picture represents Apple iPod/iTunes Business model.

Although Apple wasn’t the first company to bring a portable media player to the market. But what enables Apple to dominate the market is that they mixed between their portable device and their Software (iTunes) in addition the perfect design of the device. So we can say that Apple entered the war with a stronger business plan therefore it win at the final.

The day when I knew the meaning of true learning

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                 Last week , I had a lecture to attend in AUC “American University in Cairo”. The lecture was given by Sean Griffin, Kristen Bergman, Darren Fuqua. In fact it wasn’t a usual lecture like those who one attends every day in the college or like lectures and sessions organized inside events or trainings.

It was the first time for me to attend a lecture given by three persons in the same time !! Really it was very useful to gain from the knowledge of three persons and they really tried to share their experiences with us.

Inside my college , I really preferred the way that Dr. Ahmed Refat Azmy used while giving his lectures. He used to listen to our questions and inquiries what ever they were. I don’t think that he tried to mock anyone tried to ask him and I was proud of being his student. His teaching methods tried actively to involve us in learning. It was a different experience and I really loved that. At the end of the term I got excellent in that subject.

Back to AUC lecture , If I said that Dr. Ahmed tried to involve us inside his lecture , Mr. Sean Griffin –The main lecturer- created his lecture from students contributions.

At first , he asked about the problems any entrepreneur face before launching their project and  he involved us in a discussion about how we can overcome these problems.

The thing that amaze me is that he didn’t ignore any contribution , he write them all and tried to make them more related to the topic. I will try try to share the obstacles and the suggested solutions with you.  

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What holds us back :

1- Laziness                                                                      2- Lack of money   

3- Lack of Knowledge                                                      4- Fears of loss and failure

5- Corruption                                                                   6- Strong Competition

7- Cost of opportunity                                                     8- Stereotype

9- Bad management                                                       10- Legal Issues

11- Beaurocracy                                                              12- Social Boundaries

                                             13- Bounding Team

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How to overcome :

1- Create a stable market.

2- Learning communication skills

3- Talk less , listen more.

4- Trust in yourself. Just do it.

5- Choose your team members carefully.

6- Try to benefit from experience of others.

During the session , I really was pleased to see a lecturer who can successfully gain from all the ideas and contributions of the attendees. It was a nice experience and I hope to repeat it soon. Thanks Mr. Griffin , you showed me a unique technique that made learning fun.

 

Best Wishes

Ahmed Kamal