How To Write a Business Plan Part 8 – Your Business Model Slide Business Podcast
Summary
Part 8 of How to Write Your Business Plan where we scope out your Business Model.
There are a few business models and hybrids you can use in your business to make money
We’ve covered your elevator pitch, problem, solution, product, and market size slides. Now we figure out your business model
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A full transcript of the episode is below
Hey there. Welcome to another episode of Build a Business Success Secrets. I am your host, Brandon C White. And today we are on part eight of how to write your business plan in 13 sides, a quick review of where we went in Part one.
We went through the 13 slides and gave a brief description of what we would be doing in Part two. We started Slide one, where we talked about you giving your elevator pitch and a formula so that you could quickly come up with that elevator pitch.
Then we set up the problem. We talked about what problem we’re addressing with our product or service. We talked about a solution and what that would ideally be, and then we showed in the product slide our product and how it solves that problem and is the solution.
In our last episode, we talked about building your market opportunity slide and how you build that strategy, and I gave you the biggest mistake that you want to avoid when you do that.
Then today we’re talking about your business model. This is all about how your enterprise operates.
Let’s not waste another second and get to the episode all right. Today we are on part eight in our series of how to write a business plan in 13 slides, and we are on Slide six, which is your business model.
I am going to make this really easy for you to figure out and start to understand today. And once you grasp the concept here, you’re gonna whip this slide out and you’re gonna have the foundation to build our financials.
Really, every slide that we are building here ultimately will have a line item, a tab or a section in our financials that truly are the story of our business.
And speaking of stories, what a business model really is. It’s a story that explains how your enterprise works. And there’s been a lot of talk about what business models are. This sort of happened in the in the dot com craze in the early days.
But to break it down really simply, there’s two types of business models, one of which you probably have. One is business to business, so that’s a business selling to other businesses. And then there’s business to consumer where you are either the manufacturer or the distributor or the retailer and you sell to the consumer.
Now, the important part of building this slide is telling your story. So how does the product that you are selling or service get delivered to the customer? If you’re a business to business, you basically sell to other businesses.
Think of an enterprise software company or a stationary company. Or maybe you make gifts for companies that they send out for special occasions. Or you host events for people and have facilities to do that, whether maybe now, in this cove in time, you’re doing it virtually for people on your organizing that because not all companies know how to do virtual events.
If you’re a lawyer, an accountant, you may sell to other businesses and not to consumers. So how does that product or service get there?
And what I mean is this. Let’s talk about what a traditional supply chain might look like. Manufacturer would sell to a wholesaler wholesaler sells to the distributor distributor sales to the retailer retailer sells to the consumer and in every step, depending on where you may fall in, that depends on how much margin you can make on your product.
Now. You may say, Brandon, I sell directly to consumers. Great. That would be a business to consumer. You still have a supply chain.
Maybe you are a drop shipper. So you sell directly to the consumer on Amazon and via your website. And maybe you have a Shopify site or an Etsy site. Or maybe you just sell directly to your email list, whatever that is.
How does that product get to you? Do you do you source it in China? Do you have a US manufacturer? Do you keep it in a distributor warehouse and then that warehouse ships for you? Do you ship yourself? Basically, what I want you to do here is think of this slide as a story and you can just put blocks.
Think of several blocks with arrows showing exactly where it all starts, and then how it gets to your ultimate consumer, whether that’s an individual consumer or a business, and then map the economics all the way through. So how much does it cost you through all of those steps?
And once you understand that you can see how much money you can make and this is going to drive the economic So the business model here isn’t as complicated to understand is maybe some other things because it’s either business to business or a business to consumer.
Now you could have a combination of that. Ah, lot of companies now used to sell other companies.
Let’s talk about Patagonia. Clothing would be one Patagonia used to sell to retailers. They also sell direct through their catalogue for many years and then recently have gone direct to the consumer. I say recently, maybe over the last 10 or 12 years have started to open Patagonia’s stores.
So now what we’re finding is manufacturers going direct to consumers and not selling to retailers because they can make more margin. And retailing sort of changed in the sense that consumers changed how they spend. And, of course, with the advent of the Internet, the ability to reach consumers at the press of a button is incredible.
So regardless of where you are and what your product is mapped this out, just put shapes. If you will. You can put rectangles with arrows and then show the chain in this and then map the economics, so show how much margin you make and how the money flows through there.
And with that, that’s really the crux of this light. If you could get that done, that would be awesome. You can mapped this out using Excel. You could map this out using your notebook on paper to start and then just translate that into either power point.
I use keynote on the Mac, which I think is either easier or Google slides and what that you’ve got your business model slide built. Well, that wasn’t too bad at all, was it? Get that business model slide built, and we are owes halfway through writing your business plan.
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