Entrepreneurial success depends on business models, not concepts.

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Now the market competition white-hot stage, if can create a big market potential, and blank market. Obviously the competition is low, the risk is small, and the profits are high. This is what every entrepreneur is dreaming of, but is there such an entrepreneurial project on the domestic market?

The answer is yes. Once a friend who wanted to start a business came to talk to me about a project that "revolutionized the market gap". He wants to do health care products, which is not surprising, his so-called "blue sea" is to sell health products to the countryside. Friends said: "Throughout the current nutrition market, all concentrated in the cities above the city, counties and villages below the market is a blank." "He was very proud of his concept and thought he had found an excellent entrepreneurial project. "This market is very big, think about it, there are 900 million farmers all over China, one-tenth of people buy my products, is 90 million of sales." ”

I have no friends so passionate, so I poured a pot of cold water to friends.

"Is the market real? Why is there no one in such a big blank market?" How can such a market be opened? How to follow up on the development? What kind of sales model to take? How to make sure your price has a competitive advantage? Before I could keep on asking questions, my friend interrupted me at once. "You're so pessimistic, entrepreneurship needs enthusiasm." If you have a good idea, you must do it at once. Ma Yun said: ' Entrepreneurship can not stay in the concept and fantasy. Time waits for no one, and when others think of it, it is too late. ”

In fact, a friend of the wrong understanding of Ma Yun's sentence. The concept to this day has not been able to sell money, nothing new under the sun. The so-called new concept, in fact, are new bottles of old wine. Actually have been talked about times, even in practice. Therefore, the concept must be changed into concrete things, not to let the concept fly in the air. Otherwise, the concept can only be ideas and illusions. Ma Yun said: "Entrepreneurship, to really think about what you solve the problem, create a unique value." "Of course, more important than this: is the market willing to pay the price you want for this value?" The most important thing is how to achieve this jump in value to price, that is, to successfully sell value.

No great entrepreneur in the world has ever said that he had a grand plan at the beginning of its creation (or even before it started), and the first step is always how do I survive. To survive, the first thing to think about is how to turn the concept into real gold and silver. But the so-called market, which is calculated as a friend, is totally meaningless.

How is the real market calculated? Add and subtract without multiplication and division.

There are many friends in the business before the calculation of the market, often like friends of "900 million people, One-tenth buy my Product" idea. They first delimit the market total, then define their own goal, so that a division and multiplication will be OK. This is illogical, the crux of the matter is: Why do the One-tenth people want to buy your product? The real market, the customer is a one plus go, Sales is a point plus, the profit is a penny minus. Consider when you can sell your first product.

Of course, these are just a few of the more important things than the concept. The thing that is more important than the concept is the business model.

What is a business model? What are the elements? What are the characteristics of a successful business model?

The so-called business model, refers to the enterprise to enable the operation of the internal and external elements to form a complete and efficient operation of a unique core competitiveness of the operating system, and through the optimal implementation of the form to meet customer demand, realize customer value, while enabling the system to achieve sustainable profit objectives of the overall solution.

More complicated? A simple, straightforward explanation: business model is the way in which companies make money?

Business model is a simplified business logic that contains some basic elements that combine to form the system environment of an enterprise entity. The concrete elements are shown in the following table:

Table: List of business model elements

The name elaborates the practical significance

Value Central products or services can provide the value of the product to find a unique selling point and demand points, to have sufficient reason to support: Consumers are willing to pay for the value of the corresponding price.

The target group is aimed at the consumer groups to facilitate the market division, at the same time facilitate the formulation of the corresponding promotional and price strategies.

The various ways that the distribution channel enterprise contacts with the consumer involve the enterprise's market and distribution strategy, which is used to formulate the market development strategy.

The financial description needed to be pointed out in the process of cost structure value when the cost of a certain factor of production is higher than the proportion of the total cost of the enterprise, the factor of production becomes the main risk of the enterprise. Find ways to further reduce costs and risks.

Income model How does an enterprise obtain income from cash income? What are the forms of income? What are the forms and proportions of these revenues allocated in the industrial chain? Do companies have a say in this distribution?

To realize the form of enterprise specific sales, production and other ways how enterprises should be financed? Research input as the proportion of total income? How to obtain the trust and cooperation of customers? The realization form is based on the profit structure oriented organizational structure design.

Risk control effectively put an end to the adverse factors that threaten the business safety of enterprises, cultivate the awareness of risk prevention beforehand, and establish the corresponding supervision system to ensure the realization of this consciousness into the actual operation of the enterprise.

Business model, not a breakthrough in a certain point, but runs through the enterprise resources development and research models, manufacturing methods, marketing system, market circulation and other links.

A successful business model should have three major characteristics:

1. Continuous profit. Whether the enterprise is profitable is the most obvious standard to judge the business model. A business model that cannot make a profit is absolutely unsuccessful. Of course, in most cases, the start of a business model does not make a profit, but you have to find a reason to convince yourself to be profitable.

2. Maximize customer value. Whether a business model can continue to be profitable is necessarily related to whether the model can provide value to customers. A business model that does not provide customer value, even if it is profitable, is temporary and not sustainable. and a business model that delivers value to customers, even if it is temporarily unprofitable, will eventually be profitable. Based on this, the successful business model is to provide customers with the greatest value as a design principle.

3. Self-protection. In the competitive market, the more difficult to replicate the business model will be able to achieve sustainable profitability. Therefore, the successful business model must have self-protection function. For example, in the business model design, in the distribution channel design, the adoption of an exclusive distribution agreement. Other such as brand, core technology is a manifestation of self-protection.

Business model is the core logic of creating value for an enterprise, and the enterprise competitiveness and sustainable development are formed on this basis. Its core is from the product---sales----operation----The process logic of capital transmutation. The design of business model is actually the design of effective integration of resources.

Business models determine whether entrepreneurship can succeed. Michael Eng, former chief executive of Time Warner, said: "In the process of running a business, business model is more important than high technology, because the former is a prerequisite for enterprises to be able to base themselves." "Based on this, be sure to figure out what your business model is, which is more important than the concept in your head," he said.

If there are reprinted indicating the source: Shandong Entrepreneurial Network www.sdchuangye.cn