Business model is very important, which is the initial thinking of entrepreneurs to create enterprises, and the emergence of enterprises is bound to be accompanied by the emergence of corresponding business models. Therefore, the first step to systematically understand an enterprise is to understand its business model.
This sharing is mainly divided into three parts. In the first part, we talk about business model design. In the second part, we talk about how to make a business plan. In the third part, what we want to talk about is more important than business model. What is this? Leave a suspense first.
First of all, let's look at the first part: business model design. So what is the business model? First, let's look at what business is. The original meaning of business is an organized behavior of providing goods and services that customers need, and its purpose is to make money and gain profits.
Then the business model can be summarized as "a systematic description of how enterprises can meet users' needs and create value for users by providing certain products and services, so as to obtain income and profits".
At present, many entrepreneurs regard a product that they take for granted as a business model. This understanding is wrong. Products and business models are different. Products are only part of the business model. Only when your products are valuable to users, users pay for your products and services, and finally achieve large-scale profitability, can it be called a business model.
Wechat is an Internet social product, not a business model. Only by transforming users of WeChat into value-added services such as games and advertisements to achieve profitability can it be called a business model.
360 antivirus software is an Internet security product. Only by converting traffic into large-scale commercial income and profits can it be called a business model.
In addition, although some enterprises provide products with many users and can obtain large-scale income, the income can not cover the costs and expenses, and the enterprises can not make profits, which can not be called business model. A good business model must be profitable. For example, once very popular group buying websites such as Handan.com and Gaopeng.com, and O2O services such as door-to-door manicure and door-to-door car wash all have certain users and certain income. But this model can only rely on subsidies to attract users. Once subsidies are stopped, users will be lost, doomed to be unprofitable and eventually closed down. These cannot be called business models.
Jack Ma, founder of Alibaba Group, once took the long-term loss of rival JD.COM Mall as an example, saying that "what can't achieve large-scale profit can't be called a business model, but can only be called a business behavior". However, according to the latest financial report, in the fourth quarter of 20 17, JD.COM achieved a net profit of 5 billion yuan according to non-US GAAP. Liu responded to Ma Yun's query about JD.COM. COM's business model matched his performance, which also brought about a sharp rise in the stock price. At present, the market value of JD.COM is as high as $65 billion, only $654.38+0.5 billion away from Baidu.
As we said before, the business model is "a systematic description of how an enterprise can meet the needs of users and create value for users by providing certain products and services, so as to obtain income and profits".
It mainly includes six core elements, the first is user demand, the second is products and services, the third is marketing and sales, the fourth is profit model, the fifth is market space, and the sixth is strategic partners.
Zhou, the founder of 360 Company, once said that the business model is what kind of products you can provide, what kind of value you can create for users, and in the process of creating user value, how do you obtain commercial value, and commercial value is profit. This sentence of Zhou contains the first four of the six core elements of the business model.
Look at the user's needs first. User demand is the premise of designing any business model and the first core element of the business model. A good business model must first clarify the problems and pain points of the target customers. Enterprises must look at the value of products and services from the perspective of users, not from the perspective of taking it for granted. Many entrepreneurs fail because they have made a product and service that they think is great, but there is no user demand and no user value.
To determine the needs of users, we must first determine the target users, and determine what kind of users we provide products and services to, the elderly or teenagers? A man or a woman? Elite or ordinary people? Internet users or offline users? Urban users or township users? Large and medium-sized cities are still third-and fourth-tier cities.
After determining the target users, we need to determine what needs we want to meet and what pain points we want to solve. The original intention of every business model design is to meet some needs of users and solve some problems of users, regardless of whether the business model is successful or not. For example, Didi solves the problem of difficult and expensive taxis during travel; Mobike and ofo solve the problem of convenient short-distance travel for users. Tencent solves the online socialization of users.
Business models that have no user needs and cannot solve the pain points of users are all pseudo-business models.
The second core element of business model is products and services. Products and services are the solutions we provide to users after determining their needs. They are the basis of business model, and all great enterprises are product-driven enterprises.
What kind of products and services does the enterprise provide to users? What is the difference between these products and services? What kind of value has it created for users? And how to provide these products and services, whether through outsourcing production or self-production, are all questions that business models need to answer systematically.
For example, in TV, mobile phones, computers and other fields, a mature OEM system has been formed, so Xiaomi, Hammer and other enterprises choose to outsource production. There is no mature OEM in the automobile industry, so new entrants in the automobile industry like Tesla choose to build their own factories or acquire a factory.
The third core element of business model is marketing and sales. Marketing and sales are how to make products and services reach customers and realize the final transaction. Is it through media advertising, conference marketing or telemarketing? Is it sold online or offline? Do you choose direct selling or distribution? These are all questions that need to be answered by the business model, and they are also important issues that investors care about.
For example, the Internet mobile phone represented by Xiaomi was mainly based on Internet marketing and e-commerce sales. Oppo and vivo are marketed through popular TV variety shows and outdoor advertisements such as airports, high-speed rail and bus stops, and the sales channels are concentrated online and offline. In 20 17, Xiaomi vigorously expanded offline channels such as Xiaomi House and began to pay equal attention to online and offline. Its own channels are combined with third-party e-commerce platforms such as JD.COM, Tmall, Suning, Gome, etc., and its marketing mode has also jumped out of the past online marketing, and it has also begun to put a large number of advertisements in TV stations, airports, high-speed railway station, bus stations and elevators.
The fourth core element of business model is profit model, that is, how to obtain business value as Zhou said. There is a joke in the industry that all unprofitable business models are hooligans. So any business model must solve the problem of how to make money, whether it is short-term profit or future profit. JD.COM, Didi, Meituan and other quasi-Internet giants are most criticized by the media and investors for their long-term unprofitable business model and natural defects.
Enterprise income is equal to product unit price multiplied by sales quantity, and profit is equal to income minus cost minus expenses. So in the part of profit model, we need to determine how products and services are priced and the relationship between pricing and sales. Then it is necessary to calculate the costs and expenses of maintaining the operation of the enterprise. If the enterprise wants to make a profit, the income must cover the costs and expenses. The business model needs to accurately calculate income, cost, expenses and profits, and the business that loses money for a long time and cannot achieve profitability is not a real business model.
Declining portals, vertical e-commerce, group buying websites, video websites, and now popular * * * bicycles, * * charging treasures, O2O, the biggest problem is that it is difficult to cover high costs and expenses with income. Not long ago, mobike was acquired by Meituan, because it only had a monthly revenue of 1 billion, but it had a cost of nearly 600 million. In this case,
Recently, the business cases of network video industry have been systematically studied. There is a natural business model dilemma in this industry, that is, advertising revenue and membership fee income can hardly cover its high content cost, bandwidth cost and labor cost, which eventually leads to the closure of many video websites or survival under the protection of giants such as BAT. So now we can see that the three major video websites, Youku, Tencent Video and iQiyi, all belong to the BAT system.
Suddenly, this is an important basis for enterprises to decide whether to enter this field. A business model without much market space is not a good business model, and it is difficult to win the favor of investors.
There are two factors that determine the market space: first, how big is the market scale of products and services provided by our enterprises, is it growing or shrinking? Second, how many competitors does the enterprise face and how fierce the competition is? How much market share can enterprises gain? This is of great concern to investors. If you want to be the next BAT, you must have a market space of BAT level.
Why is the capital value of Volkswagen and Toyota, which are closer to ordinary users, much larger than that of luxury brands such as Ferrari and Rolls-Royce? The core is that Volkswagen and Toyota face greater market space. Why did Tesla's share price soar after the release of Model 3? The reason is that the price of this model is more easily accepted by the public, with a wider user base and a larger market space.
Therefore, to create large enterprises, we must choose fields with large market space, which is also the reason why large enterprises are concentrated in industries such as finance, energy, automobiles, real estate, consumer electronics, and fast-moving consumer goods, because the market space in these fields is large enough.
The sixth core element of business model is strategic cooperation, which is ignored by many entrepreneurs. In the Internet era, the whole commercial society is becoming more and more open, and the establishment of external strategic cooperation has increasingly become an important part of the business model. Many enterprises optimize their business models, acquire resources and reduce risks by establishing strategic alliances. Therefore, establishing a business model requires us to determine who is our most important partner? What core resources can I get from my partners?
The business models of Apple and Xiaomi are inseparable from Foxconn, an important strategic partner; The business model of Tesla electric vehicles is also inseparable from the battery technology of Panasonic in Japan, so entrepreneurs should learn to use social resources for their own use. If Apple, Xiaomi and Tesla are all like traditional enterprises in the past, all business links will be solved by themselves, and the development speed will be much slower.
Because business models involve many different industries and different types of enterprises, it is difficult to classify business models uniformly. Massachusetts Institute of Technology put forward a business model classification method, which divides all enterprises into four categories according to the nature of their activities: manufacturers (manufacturing and providing product ownership), sellers (providing product ownership without changing product form), lessors (providing product use rights) and brokers (providing media between supply and demand). The products or services provided are divided into four categories: financial products (money, capital, etc. ), physical products, intangible products (intellectual property rights, brands, etc. ) and human resources products. The combination of each kind of activity and each kind of product is a business model, so all business activities in the market are divided into 16 types from the business model.
Next, let's look at several specific cases of business models.
Why do Internet companies make the most money in search, e-commerce and social networks, while Google, Amazon and Facebook, the most profitable and market-valued companies in the United States, are also search, e-commerce and social networks. This is because search, e-commerce, social networking and other products meet the needs of users, with high frequency of use, huge market space, and more importantly, close to money, it is easier to find ways to realize commercialization. A good business model must be the closest to money, such as e-commerce, finance and games, all of which are the closest areas to money.
Why does Xiaomi mobile phone rise rapidly once and fall rapidly once? This is because in 20 1 1, smartphones are generally low in configuration, expensive in price and poor in operating system experience. Lei Jun grasped the pain points of users at that time, provided users with high cost performance, and the operating experience far exceeded that of other brands of Android smartphones, and achieved great success. However, by 20 15, smartphones were widely used, and the operating system experience was generally improved. The prices of mobile phones such as Meizu, Glory, LeTV and 360 continued to break through the bottom line. The advantage of Xiaomi's mobile phone in the past is not his advantage, and it can't meet the new needs of consumers. Oppo and vivo, which were not well-known before, have become the dark horses in the mobile phone industry because they have grasped the new needs of several users such as battery life, photography, sound quality and design.
Let's review, the business model mainly includes six core elements, the first is user demand, the second is products and services, the third is marketing and sales, the fourth is profit model, the fifth is market space, and the sixth is strategic partners. These six elements constitute the core framework of enterprise business model. You can use the six-element model of business model we give to think and plan your own business model.
After talking about the business model, let's look at the business plan. Business plan and business model are inseparable, which is an important bridge for entrepreneurs to pass business model to their partners. A clear business plan, whether the entrepreneur is financing equity for PE, VC and other venture capital institutions, or financing creditor's rights from banks and other institutions, or recruiting partners to discuss cooperation with strategic partners, will greatly increase the audience's impression of the enterprise.
The business model we mentioned in the first part is only part of the business plan. In addition to defining the business model, the most important thing in the business plan is to solve the landing problem of the business model.
We have provided a large number of business model consulting services in the field of business planning for different industries and types of enterprises before, and summarized a general template for writing business plans for your reference. We suggest that the business plan mainly includes six parts: project introduction (also called one-minute core points), market insight, business model, core resources and capabilities, business planning and financial prediction, financing and capital use plan.
The first part of the business plan is a brief introduction to the project, which I used to call the one-minute core point. The core point of one minute is to express the core point of the business plan with one or two pages of PPT in the most refined language. Not everyone has enough time to listen to you spend hours describing your complete business plan. One-minute core points help enterprises to leave a deep impression on the audience in the shortest time.
The core point of one minute should express the core elements of the enterprise: what kind of road to take, what kind of products and services to provide, what kind of differentiation, and what kind of needs to solve for users? In addition, what is the mission of the enterprise and corporate vision?
The mission is the meaning and value of the existence of an enterprise, and the vision is what kind of enterprise it hopes to become in the future. Investors prefer entrepreneurs with foresight and ambition. Entrepreneurs who have no mission and vision are often not determined enough, or give up halfway, or fall into opportunism.
The second part of the business plan is market insight. Market insight is your original idea about starting this business venture project. What kind of market opportunities have enterprises seized? What kind of needs and pain points have you caught? Rigorous and convincing market insight is very important for new projects, which can increase the audience's cognition and recognition of this project.
Market insight mainly focuses on industry development trends and user needs. Industry trend analysis is used to prove whether your entrepreneurial project conforms to the future trend; User demand analysis is used to prove whether your entrepreneurial project is realistic and feasible.
Li yanhong led Baidu All in artificial intelligence, mainly foreseeing the future trend of artificial intelligence era. Lei Jun's Xiaomi mobile phone is largely an insight into the user's demand for cost-effective smart phones and smooth operating experience.
The third part of the business plan is a complete exposition of the business model, and its core is six elements: target users and user needs, products and services, marketing and sales, profit model, market space and strategic cooperation. You need to explain your business model clearly in your business plan. We have introduced it in detail in the first part, so I won't repeat it here.
The fourth part of the business plan is the core resources and capabilities of the enterprise, which is the most important part of the business plan and the basis for ensuring the landing of the business model. What kind of resources and capabilities you have must be systematically expounded in the business plan, and the audience will be very concerned about whether the entrepreneurs have the resources and capabilities to put the business model to the ground. This part needs to elaborate on the background of the founder team. Although the business model is very important, the founder team is the basis for turning the business model into reality.
Investors judge whether an enterprise is reliable or not, mainly depending on two factors, one is things and the other is people. The business model can only explain whether what you are doing is a reliable thing, not whether you can do it. Whether it can be done or not, talent is the key.
The fifth part of the business plan is a detailed business plan and financial forecast. If the business model is just an idea, then the business plan needs to explain the path to realize the idea.
Business plan is divided into quantitative and qualitative parts. The quantitative part is the prediction of core business indicators, such as the number of users, order sales, etc. The qualitative part is the specific planning of entrepreneurs in production research, supply chain, brand, marketing, sales and service. This part most tests the skill of entrepreneurs. If you can't make a clear and executable business plan for a startup project, it's hard to be convincing.
In a business plan, there should generally be a business plan for the next 3-5 years, a detailed financial forecast for the next 3-5 years, and an accurate estimate of income, costs, expenses and profits.
The biggest audience of business plans is investors. In the face of investors, a clear financing and capital use plan is very important. The core of the financing plan is to determine the enterprise valuation, the proportion of equity transfer, the amount of financing and the requirements for investors. However, in order to make enterprise valuation more convincing, it is generally necessary to conduct benchmarking research with similar enterprises. The income, profit and valuation of enterprises in the same industry are the important basis for us to make a reasonable valuation of our own enterprises. Otherwise, too high a valuation will scare away investors, and too low a valuation will harm the interests of entrepreneurs.
In addition, the business plan also needs to specify the plan for the use of funds, which investors are very concerned about. They want to know whether the investment money will eventually flow to personnel recruitment, product research and development, brand promotion or logistics system construction.
Entrepreneurs should also choose their own investors and don't take everything. It is best to find investors with similar values, trust the entrepreneurial team and understand the essence of the business model. Otherwise, finding a mercenary investor with no moral sense will continue to put pressure on you, become a big obstacle to your business development, and even take away your control over the enterprise.
Although the business model is very important, I still don't want to exaggerate the importance of the business model. In fact, what is more important than business model is mobility, which is my personal experience as a consultant, as a business observer and as an entrepreneur.
A good business model, if you don't take action, you will always stay in words or words, which will always be just an idea.
A bad business model, if acted decisively, will be constantly optimized and adjusted in the course of operation, and may gradually evolve into a good business model.
Ma Yun also mentioned in his speech to young entrepreneurs in Hong Kong, "Many young people think of thousands of ways at night and take one way in the morning. Entrepreneurship is very important, that is, act immediately and act now. "
On weekdays, many friends who want to start a business come to me for advice. I usually encourage them, because no one can predict the potential released by the other party after starting a business. You can try as long as you have an idea. However, there are two kinds of friends who plan to start a business. One kind of people just talk. There is another kind of people who say and do.
So I suggest that friends who have entrepreneurial ideas can make decisive moves. First of all, referring to the six elements of business model and the six steps of business plan mentioned in our course today, we systematically sort out the business model of their planned entrepreneurial projects and write a complete business plan. The process of writing a business plan is not only a process of perfecting your entrepreneurial idea, but also a process of testing and correcting your entrepreneurial idea.
With a business model and a business plan, how to start a business and how to take the first step is another important problem that puzzles entrepreneurs. We often see on the Internet some entrepreneurial cases in which entrepreneurs rapidly expand their enterprises through huge financing and go public within 3-5 years. In fact, these situations are extremely rare, not universal, nor can they be encountered. More entrepreneurship needs to be cultivated step by step.
My suggestion is that you should first conduct a comprehensive review of your own funds, resources and capabilities. First of all, recognize whether courage, resources or ability hinder your entrepreneurship.
If courage is an obstacle to your action, I think you can choose to give up, because entrepreneurship belongs to the brave. If you are afraid of risks and don't have enough courage, then you'd better choose to continue to engage in risk-free work in the workplace and live a comfortable life, which is also a good choice.
If your ability hinders your action, I think you can stop first, accumulate a few more years in the workplace, and it is not too late to start a business after you have enough control. I know many successful entrepreneurs, and the success of starting a business mainly depends on the accumulation of resources and abilities of their years of workplace experience.
If what is holding you back is not courage or ability, but resources, I think you can try. At this time, you need to be a preacher. Relatives, friends, colleagues and classmates around you may become your investors and partners. You have the ability and courage, and you are not afraid to pry resources.
If you have the ability, resources and courage, it doesn't mean that you will succeed in starting a business soon. What you need at this time is to keep a low profile, not to rush to do it overnight, but to return to zero and start from small things. In addition, when encountering setbacks, we must persist and don't give up easily. As long as we persist, there will be light.
The business model is not only suitable for prospective entrepreneurs who are ready to start a business, but also for those who encounter some bottlenecks and seek breakthroughs. It is also suitable for those who are well developed and have great dreams. Even if you are not an entrepreneur, understanding the business model will help you understand the essence of business management from a deeper level.