You might think that as a small business you don’t really need to worry about your business model.
That is for the entrepreneurs who are serious business people right. That word isn’t important for little old us.
That is where I step in and say, you better check yourself!
This word is absolutely fundamental to your success as a business person, whether you plan on making a million, or you dream of having enough to pay the mortgage and go on holiday a few times a year.
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All businesses are a challenge, no matter how big or small and their success relies heavily on getting your business model right. So, today let’s dive in now and really get to grips with what a business is.
What is a business model
Effectively your business model should tell someone who reads it exactly how you are going to make money. It needs to be very specific, you should know which market you’re playing in, what makes you different from the competition and what value you are providing to the market.
These details need to be very defined and clear. The key is to create a plan so precise an 11 year old could follow it and make money.
Why does a company need a business model
Without a clearly defined business model you have no idea what to focus on and prioritize in your business. Companies who don’t work on their model before they start often find their business model just isn’t working.
I couldn’t have grown my business to 6 figures so quickly if I didn’t know exactly which business model I was working with. We sell pre-made business packages to work at home mums. Our core differentiator is that we make it very easy for mums to just get going straight into running their business, even if they don’t have previous business or marketing experience.
We provide a lot of support, and community is very important to our business. So, our business mums group is super important and that’s why I put so much effort into making it a supportive and friendly place to be. These decisions are easier to make once you have a very clear idea about how you are going to make money.
How to create a business model
Luckily for you there is no need to create a business model from scratch. In fact, I would strongly advise against it if you are a first-time entrepreneur. No-one gets any glory from re-inventing the wheel. Before you even sit down and start creating it, do some research in your industry. How have other businesses set up their business? There are also tons of articles out there which break down the most popular business models.
Start by getting familiar with the language and see what is possible.
As you get into the language you will begin to spark ideas and figure out what you do and don’t want in your business. For example, you might come across a very interesting article like this which explains the challenging aspects of a web design business model – (something I can fully relate too).
Make sure whichever model you choose supports the lifestyle you want to create.
Do you have a business model in place? Share with us in the comments.