Clothing Enterprises Must Read: Is Your Business Model Reliable?

Encountered many entrepreneurs and investors, often talk about the "business model".

Wait a minute! Is that really a business model? Unfortunately, if you listen carefully, you will find that nine of the ten entrepreneurs haven't figuring out the problem, and many people even don't understand the word business model.

Many people often say: "business mode is not how to make money?" wrong! How to make money, academic name is "profit mode", that is only a link of business mode.

What is the business model? Harvard Business School professor Clayton Christensen has a classic definition of business models: the business model is how to create and deliver customer value and company value.

It includes four links: customer value proposition, profit mode, key resources and key processes.

If you think this definition is too academic, I can explain briefly. The business model has four points: first, what value can you bring to your customers? Second, how do you make money after bringing value to customers? Third, what resources and capabilities do you have to achieve the first two? Fourth, how do you achieve the first two points?

If you ask these four questions,

Many technology startups do not want to understand this problem.

They often have a technology that thinks they are very good. They think that they have a market. In fact, market demand and technical leadership are two different things.

A lot of technology that looks pretty, almost no market.

You go to see the scientific research achievements in the laboratories of the Chinese Academy of Sciences and universities, most of them seem very dazzling, but less than 10% can be converted into market demand. This is also the reason why many technology startups are prone to failure.

Other companies have solved the problem of "customer value proposition", but there is no direction in how to make profits.

Many Internet Co often describe an abstract prospect for you when financing: as long as our users reach 10 million, 10% of them pay, then we can earn a lot of money. In fact, it is not the same thing at all. Many domestic Internet companies' profit models are still limited to online advertising.

Anyone who has been a website knows that online advertising can be called "winner take all", and 1% of the company occupies 90% of the market share. If you can not do the first few, the online advertising is basically no game.

Of course, many entrepreneurs also want to be very clear that they can not earn money from consumers, they want to earn investors' money.

Indeed, some entrepreneurs have succeeded in taking a lot of money from investors, but they are not profitable, but such stories often end badly, because patience is often limited.

The cake is round again, and it will be cashed one day.

If we can't make a profit after a certain period of time, the value of the company is basically zero. Naturally, it won't win the favor of investors.

If customer value proposition and profit model are often related to strategy, the key resources and key processes will test the execution ability of an enterprise.

Take apple as an example, its "key resource" is Jobs, and has very innovative ability.

This is easy for many entrepreneurs to overlook.

They often regard themselves or so-called relationships as key resources, but at the same time overestimate the strength of themselves and the so-called relationship, but do not establish the competitiveness of their organizations.

In terms of system and process construction, it is the weakness of most start-up companies. They tend to be superstitious in their personal abilities and neglect the construction of systems and processes.

Such carelessness often results in these enterprises failing to get through the initial stage, or they will not grow up.

Now, looking back at your own business, do you think your business model is reliable?