Business Model Canvas: The 9 Building Blocks of a Business

Credit: Strategyzer.com

This is the Business Model Canvas, a tool that helps you map, discuss, design, and invent new business models. It’s what you need to craft a powerful business model.

There are 9 essential building blocks that make up any business model. When you get all nine blocks working together, you would have answered the fundamental questions any business model must solve.

Let’s go through the BMC together!

1. We’ll start with Customer Segments! These are all the people or organizations for which you’re creating value. This includes simple users and paying customers
2. Next, for each customer segment, you’d have a specific Value Proposition. These are the bundles of products and services that create value for your customers.
3. Think about the Channels, the touch points where you interact with customers to deliver value.
4. The Customer Relationships outline the types of relationships you are establishing with your customers and how you are acquiring and retaining them.
5. How would you make money through your business? The Revenue Streams make clear how and through which pricing mechanisms your business model is capturing revenue.
6. Which resources and assets are indispensable in your business model? You can describe the infrastructure you need to create, deliver, and capture value in the Key Resources.
7. Key Activities are the things you need to perform well to deliver your value propositions.
8. Similarly, Key Partners are the business partners you need to leverage your business model since you probably would not own all key resources yourself nor perform all key activities.
9. Last but not least, once you understand your business model infrastructure, you could list all the costs that you will be incurring in the Cost Structure.

With the Business Model Canvas, you can map out your entire business model in one image. This works for start-up entrepreneurs just as well as for the most senior executives.

Any business model can be mapped this way, with nine building blocks working to reinforce and strengthen each other. But before you make model for yourself, it helps to see what a breakthrough business model looks like in action.

Business Model Canvas allows you to iterate many models and tests them quickly. Let’s get started with your own business idea!

Source:
Strategyzer

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