Model Business Model Canvas

In this step you need to find the core of your product’s value.

A concept, project or business exists by selling something, often a product or a service. Value proposition means that emphasis should be on what you are doing for the costumer, and not on what characteristics, functions or activities are built into the product. This is the difference between an idea and a business idea.

You may use the methods below in order to find out what your business or project actually does and/or changes for the costumer.

In this step you need to examine and document the characteristics of the costumers you would like to satisfy with your product.

Only few provide a product or service that matches everyone’s needs. Costumer segments clarify the most enthusiastic, susceptible group of costumers that also receive most value from the product. The costumers have to have a recognized or unrecognized need (cf. the building block Value Proposition).

In this step you need to map out which partners and suppliers should be connected to your company and agreeing on a binding partnership. Typically a partnership will involve a company that you are cooperating with regarding marketing, product development, purchases and so on, or perhaps the company provides rooms and equipment under favourable terms.

In this step you need to look inside your business and identify your core services. The primary question is: What tasks/activities do you need to solve in order for your business to function?

This might seem obvious, but Arla, Netto and farm shops are all businesses with the same core service: to sell milk. Their core activities vary however, as respectively industrial production, logistics, store management as well as cattle farming and milking the cows.

The activities that need to be mapped out in this step are thus the primary tasks that your business needs to master. As such this also involves considering which tasks it would be beneficial to buy other people’s workforce to solve.

In this step you need to identify your company’s available resources. This could be:

• Physical resources such as rooms and equipment
• Financial resources such as loans and self-financing
• Human resources
• Immaterial resources such as know-how, patents and so on.

In this step you need to concern yourself with your users and document which relationships you wish to establish with your costumers.

Relevant work questions:

• How are you serving your costumers? Is it for example through personal service, self-service or automatic online service?
• How is the relationship supposed to develop over time?
• Are your costumers primarily one time users or does your company have long term costumer relations, that it may even be possible to develop further over time?

The first many steps have been centred on the costumers and often these analyses will provide data for more stepping-stones. As mentioned, Business Model Canvas is not supposed to be a linear process.

In this step you need to identify which channels are available and which you wish to use in order to reach a specific user. It would be beneficial to examine your costumers’ media habits as well as their geographic location.

Relevant work questions:

• In what way are your costumers supposed to find your product?
• Do you sell it directly and personally?
• Do you use intermediaries, online shops and so on?
• Where is it possible to find more information of your product?

In this step you need to work on how your costumers are paying for your product or service. This might involve several different platforms and approaches. Do your costumers for example buy you product the traditional way or are you selling through subscription, leasing or as license? This exercise is often based on a market analysis.

In this step you need to identify the primary costs of your business. You need to have an overview of:

• Variable versus fixed costs
• Developmental or start-up costs
• Advantages of economies of scale regarding growth or does this increase costs?

To sum up, this provides an overview of what the costs are of creating and running a company – and as such whether it is an advantageous business or not.