Business Plan Writing

Module 2 - Access Fundings for your business

1. 2 Business Plan Sample
2. Business Plan Template
Download Tools
3. Business Model Canvas
4. Competitor Analysis Tool
5. Customer Profiling Tool
6. Team Profile
7. Problem and Solution Map
8. Marketing Plan Template
9. Market Segmentation
10. Market Sizing
11. Financial Plan Template
BUSINESS MODEL
Housekeeping Rules - Getting the Best out of this
program

● Zero Distraction
● Getting Ready
● You need a computer
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● Get Book
● Follow my steps
● Ask Questions
 A BUSINESS MODEL

▪ How an organization creates, delivers and captures value

▪ Shows how a company intends to make money

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9 BUILDING BLOCKS OF THE BUSINESS MODEL

The Business Model is made up of nine building blocks that show the logic of how a company intends to make
money

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THE BUILDING BLOCKS

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1:0 VALUE PROPOSITIONS
Products and services

❑The offering that solves the customer’s problems.

❑It may be a new or disruptive offer or similar to an existing market offer,

but with added features and attributes.

❑It is an aggregation or bundle of benefits that a company offers customers.

❑It states the values we deliver to our customers.

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WHAT VALUE DO WE DELIVER
TO CUSTOMERS?
❑A value proposition creates value for a customer segment through a distinct mix of
elements catering to that segment’s needs (Sterwald, 2010).

❑Values may be quantitative e.g. price, speed of service

❑Or qualitative e.g. design, customer experience

❑The value could be on newness, performance, customization, taste, variety, price,

convenience, design
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2:0 CUSTOMER SEGMENTS

❑A business model must be designed around a strong understanding of

specific customer needs.
▪ Who are we creating value for? Whose pain are we curing?
▪ Who in this group do we serve? Who do we ignore?
▪ Are their needs homogeneous or different?
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WHERE DO WE FIND OUR
CUSTOMERS?
WHERE DO WE FIND OUR CUSTOMERS?
HOW DO WE SEGMENT OUR CUSTOMERS?

❑Mass Market
▪ Models focussed on one group of customers that can be reached with the same value
proposition, distribution channels, customer relationship.

❑Niche Market
▪ Models targeting specialized customer segments. The value proposition, distribution channels,
customer relationships are all tailored to the specific requirements of a niche market.

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CUSTOMER SEGMENTS
 HOW DO WE SEGMENT OUR
CUSTOMERS?
❑Segmented Market
▪ models that serve customers with similar but slightly different needs and problems. Examples –
Airlines, Banks.

❑Diversified Market
▪ Models that serve two or more unrelated customer segments with very different needs and
problems.

❑Multi-Sided Market
▪ Models that serve two or more interdependent customer segments. Examples – Interswitch,
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3.0 CHANNELS

❑This is how an organization communicates and reaches its customers to deliver a value proposition.

❑These are customer touch points that influence the customer’s experience.

❑They create / increase awareness for the offering.

❑They help customer interact with the company.

❑They are integrated.

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HOW DO WE DELIVER TO
OUR CUSTOMERS?
4:0 CUSTOMER RELATIONSHIPS

❑The types of relationships a company establishes with specific customer segments.

❑Customer relationship drivers:

▪ customer acquisition
▪ customer retention
▪ boosting sales
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CATEGORIES OF CUSTOMER
RELATIONSHIPS

❑Personal Assistance ❑ Automated Services

❑Dedicated personal Assistance ❑ Communities

❑Self Service ❑ Co-creation

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5:0 KEY ACTIVITIES

❑These are the most important actions a business must

take to create, deliver and capture value.
❑These will include activities to deliver value
proposition, reach markets, maintain customer
relationships and earn revenues.
❑These include production, problem solving, platform /
network, marketing and customer relationship. 23
6:0 KEY RESOURCES

❑These are the most important assets required to make a business model
work.

❑The resources needed to deliver the value proposition.

❑They can be physical, financial, intellectual or human.

❑They can be owned, leased or outsourced.

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 7:0 KEY PARTNERS
❑This includes the network of partnerships and alliances that enable the business
create, capture and deliver value.
❑Organizations need partnerships to reduce risk or acquire resources.
❑Four types of partnerships;
▪ Strategic alliances between non-competitors
▪ Competition – strategic partnerships between competitors
▪ Joint ventures to develop new businesses
▪ Buyer-Supplier relationships to assure reliable supplies 27
 8:0 COST STRUCTURE
This describes all costs incurred to operate a Business Model. The cost
structure can be:
❑Value-driven
❑Cost-driven
❑Fixed cost
❑Variable cost
❑Economies of scale
❑Economies of scope 28
 9:0 REVENUE STREAMS

❑This represents the value/cash that organizations generate from delivering

value to each customer segment.

❑What value is the customer willing to pay?

❑Each revenue stream has different pricing mechanisms.

❑There are two types of revenue streams transaction revenues (one-off) and
recurring revenues (on-going payments) 29
WAYS OF GENERATING REVENUE
❑Sales of Product(s) or Service(s)

❑Asset Sale or Usage fee

❑Subscription fees

❑Lending/Renting/Leasing

❑Licensing

❑Brokerage

❑Pricing mechanisms are also important in revenue generation ( Fixed and

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dynamic pricing)
Let’s Dive - Business Plan Writing