BUSINESS MODEL CANVAS

When entrepreneurs think of a business, the first thing that comes to mind is a business plan. A business plan provides details about the business model and key things a business does.

However, the problem with today's markets is that things are moving so rapidly that by the time you finish your business plan, the market reality might have already changed.

Moreover, for many people business plan writing is such an intimidating task that it might even prevent them from implementing their business idea. The Business Model Canvas is a way to think about the business in a visual and intuitive way. In just 1 page, you can get your entire business represented. It is a more intuitive way of looking at your business idea!

the 9 building blocks

The idea is to get all the key elements of your business on a single page. The Canvas consists of 9 building blocks:

Customer Segments (who are your customers - what are their problems / painpoints)
Value Proposition (solution - your magic sauce)
Customer Relationships (secret sauce to protect yourselves from competition)
Channels (how do you reach the customers)
Key Activities (what you do to produce the customer value)
Key Resources (what you need to produce the customer value)
Key Partners (who will help you to produce the customer value)
Cost structure (what are your main costs)
Revenue Streams (in what ways can you make money)

the advantages

What are the advantages of using the business model canvas approach?

It forces you to think of your business in a more structured way.
It reduces your business model into a set of assumptions that you can then test to either validated or reject.
The overall design and layout forces you to think about the various key elements (building blocks) of the business.
It is visual and intuitive. This makes it easier to communicate the ideas.
It is easy to create and maintain. Business models can be constantly adapted to be in sync with the business realities.

business model generation

A strategic management and entrepreneurial tool. Business Model Generation explains how you can systematically understand & differentiate your business model.