Business model development
 

Table of Contents

Introduction. 1

The problem regarding market 1

Reason for innovation. 2

Customer’s benefit regarding the innovation. 2

Proposal for Business model 2

Identification of the key interrelationship in the Business model to support the success of the idea. 5

Success factors. 6

Identification of risks. 6

Evaluation of the feasibility of the idea. 7

Conclusion. 7

References. 8

Appendices: 9

Introduction

Business model refers to a conceptual structure that supports the viability of a product or a company and along with this, through the business model the operators of the company and the business operation procedure can be explained. In the report, the business model canvas by Osterwalder and Pigneur will be selected. The business idea is to establish e-commerce in a startup business which is related to a mobile food cart. The mobile food cart will reach out directly to the customers after the customers will give the order. A new mobile food app will be invented to help the customers to place their orders and they can choose the food products from the mobile food cart. The problem of the business regarding the customer and market competition will also be discussed referring to the start-up business. Along with this, the reason for the innovation of new business plan with the explanation of customers’ benefits will also be provided. The evaluation of the execution of the plan will also be made to portray the feasibility of the idea. However, the report will be concluded with the justification of the idea regarding business growth.

Problem regarding market

At the age of digitalization, the rapid rate of technological advancement increases the problems regarding the retention of the customers. Along with this, due to the open market, the customers can now easily access rates of different companies; therefore, the business authorities are facing challenges regarding the pricing strategy (Bouncken & Fredrich, 2016). Moreover, the accounting system also faces challenges regarding the up-gradation of the system to cope up with the advanced technology. The customers are facing major problems related to long waiting hours for getting their delivery of food services.

Reason for the innovation

To cope up with the technological advancement, the e-commerce business process needs to be approached to continue the progression of the business (Wei, Song & Wang, 2017). As the business products are related to various garments of different ages therefore, in the business process, the inclusion of an online selling medium is necessary to retain the customers at the age of open market.

Customer benefits through innovation

Through the e-commerce approach, the customers will be able to access the products without visiting the shop physically and along with this; they will be benefitted by getting the opportunity to get the delivery of their product at their doorstep (Ritter & Lettl, 2018). With the approach of e-commerce and online mode of marketing, the respective factors like the delivery process, the maintenance of the pricing and the quality of the food products need to be maintained. Along with this, the order process needs to be hassle-free for the customers.

Proposed Business model

In this business report, the business model of Osterwalder & Pigneur has been selected. Nine basic building blocks reflect the logic of the business authority through which they intend to make money(Clinton, McAdam & Gamble, 2018). The description of the nine business blocks regarding the implementation of the e-commerce process is as follows:

Identification of key partners:

the key partners are the manufacturers, website developer, payment processor, suppliers, and food delivery operator.

Identification of key suppliers:

The key suppliers are food products serving bags, ingredients suppliers, electricity and storage place suppliers.

Identification of key activities:

To implement the e-commerce process, the key activities of the business authorities are as follows:

• Production of the websites
• Proper maintenance of the website
• Editing and description of the attracting food products photography
• Payment process
• Management regarding food delivery

Identification of key resources:

The key resources for the garment shops are:

• Supply of food products with good quality
• Food delivery bags
• Shipping boxes
• Equipment regarding photography of the products
• Mobile food kart

Identification of value proposition:

Value proposition regarding the acceleration of the business are:

• Social acceptance
• Uniqueness regarding the inventory access
• Cheap and best quality of the product
• Review from different food blogger
• Hassle-free order system and delivery
• Offering additional services (discount vouchers and coupons)

Maintenance of customer relationships:

To maintain customer relationships, at the present age, the business authority needs to be active regarding the following sectors:

• Social media
• SEO
• Referrals of the customers, such as, (discounts, incentive programs and so on)

Identification of key channels:

Regarding the e-commerce application the key channels are:

• Websites
• Food industry
• College campuses
• Travel related sites

Customers segments:

Borrower:

Male and female over 15 years

College students

Office goers

Housewives

Lender: 

Tastemakers who have strong access over the food specifically

Identification of costs:

Cost identification is necessary to implement the pricing strategy of the products. The identification of cost depends on a few factors such as:

• Website development
• Software purchasing regarding the payment processing
• SEO
• Acquisition regarding the market and customer

Identification of revenue:

The revenue has been processed through different sectors, such as:

• Transaction fees: 15% lender, 5 % borrower
• Insurance
• Retailers

Identification of the key interrelationship in the Business model to support the success of the idea

The relationship between the business model and the success of a business is complementary to each other. As the business model guides the business authority to plan any business properly and concisely, therefore, the business planning is depended entirely on the selection of the business models (Geissdoerfer, Vladimirova & Evans, (2018). Along with this, the business blocks reveal the sectors of planning any business. For example, the partnership of any company detects the appropriate choice of the stakeholders regarding the development of the business. The key activities of the company are directly related to achieving a high level of revenues for the business.

Critical Success factors

Through the approach of the business model in creating any startup business plan, it helps to detect the challenge of innovation and conveys a better understanding of customers. Ideas of business are the basic factor of success and the business model canvas guides to do the planning appropriately (Battistella, De Toni, De Zan & Pessot, 2017). Along with this, the selection of the appropriate partnership and the stakeholders enhances the progression of the business process.

Identification of risks

The risk factors of any startup businesses are as follows (Yun, 2017):

• Lack of team experience and depth of risk
• Risk related to the market and opportunity
• Financial risk
• Political and economic risk
• Technological risk

Regarding the business, the assumptions of the risk:

As it is a start-up business, therefore, the business management authority does not have enough experience regarding the management of any business. The improper management of any business will lead the processing of any business at a stake. Along with this, without experience, the authority may not be able to select an appropriate strategy regarding the marketing and business account procedure.

Evaluation of the feasibility of the idea

The aspect of strength in this business is high as it configures to the idea of affordability and a qualified form of services. The following chart will help to explain the feasibility of the plan:

Evaluation of feasibility

Conclusion

From the light of the above context, it can be concluded that the business idea is based on the business plan the appropriate utilization of the business model can help to accelerate the business process. However, the approaches regarding the business need to be done wisely by rectifying the risks and implementing appropriate preventive measures for those risks.

References

Battistella, C., De Toni, A. F., De Zan, G., & Pessot, E. (2017). Cultivating business model agility through focused capabilities: A multiple case study. Journal of Business Research, 73, 65-82.

Bouncken, R. B., & Fredrich, V. (2016). Business model innovation in alliances: Successful configurations. Journal of Business Research, 69(9), 3584-3590.

Clinton, E., McAdam, M., & Gamble, J. R. (2018). Transgenerational entrepreneurial family firms: An examination of the business model construct. Journal of Business Research, 90, 269-285.

Geissdoerfer, M., Vladimirova, D., & Evans, S. (2018). Sustainable Business Model Innovation: A Review. Journal of Cleaner Production 198(1), 401-16. Web.

Kulins, C., Leonardy, H., & Weber, C. (2016). A configurational approach in business model design. Journal of Business Research, 69(4), 1437-1441.

Ritter, T., & Lettl, C. (2018). The wider implications of business-model research. Long Range Planning, 51(1), 1-8.

Wei, Z., Song, X., & Wang, D. (2017). Manufacturing flexibility, business model design, and firm performance. International Journal of Production Economics, 193, 87-97.

Yun, J. J. (2017). Business Model Design Compass: Open Innovation Funnel to Schumpeterian New Combination Business Model Developing Circle. Springer.

Appendices:

The business model: