What is a Business Model and How to Create a One

The business model is a simple structure of reality. Defining a business model is often difficult because it takes on different meanings in different areas of the business, and the definitions of the business model may be different based on the perspectives of the definition providers.

Simply put, a business model is how you value your customers.

In the past, you had to go to different stores for hours to buy a laptop. Most of your information was provided by the seller. The warranty and return guarantee were almost zero. That is, you bought the goods and left the store, there was almost no guarantee that the goods would be returned. But now with reputable online stores like Digikala, the way goods are presented has changed. These changes mean that the business model has completely changed.

Business Models or Categories

  • Everything you need to build something : design, raw materials, production, labor, and so on.
  • Everything you need to sell something : marketing, distribution, service, and sales processing.
  • How and for what the customer pays : strategy pricing, payment models, payment schedule, etc.

How to create a new internet business model?

Business Modeling helps you think more carefully about new products and services. Think about the following questions:

  • How are we supposed to provide the same products and services to the customer?
  • What is your communication channel with customers? Website, app, social media or all three?
  • What is the delivery method of goods and services in the new business model?
  • What is the value offered to the customer?
  • Why should a customer buy from you?
  • What people or businesses are your competitors or business partners?
  • What are your resources for starting a new business?
  • What are your costs for starting an online business?

By thinking about these questions and answering these questions, you can create a new Internet business model for yourself. We will soon be modeling different types of businesses and providing examples for each.

Conclusion

Most entrepreneurs and startup enthusiasts are looking for unrealized Internet business ideas. But this is completely wrong. What’s more important than the ideas themselves is your business model. In this article, we have defined the simple business model.

In fact, a business model is a simple study of your expenses and the amount of money you can claim for your product or service. A successful business model should only charge customers more than the cost of producing their product. New business models can modify and improve one of these three components.

You may be able to reduce design and production costs, or find more effective ways to market and sell, or you may even discover a new way to pay customers.

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