So we're going to be talking about the business model.
Cannabis, as I said, is a framework that can help you organise your thoughts and it will help you map out all the different aspects of your business.
The business model canvas was developed by these two guys and they wrote a book called Business Model Generation.
And if you want to take a look at the book, we have it at the library in the lunch spot.
So the business model canvas looks like this. It consists of nine building blocks and you start from the centre, which is your value proposition,
and then the right hand side is customer facing and revenue stream,
while the left hand side is about how you create your value proposition and then what cost you money.
So going through in a bit more detail, as I said, when you walk through through your canvas, you start from the middle.
And then, Miguel, is your value proposition. What is the problem that you're solving?
What is the problem you're addressing? What how do you create joy or alleviate pain for your customers?
And then you move to the right hand side and you work on your customer segments.
And for this segment, you have to be very specific.
Don't write down just the generic customer segment.
Think about it. What are the social characteristics of your customers?
Are they college students? Are they young professionals?
Are they single? Do they have families? Do they live in big cities or small towns?
Just think about it and be as specific as you can.
Channels. How do your customers will hear about your product and how are you going to reach them?
Are you going to use mobile? Are you going to use the web?
Do you need physical distribution channels? And finally on this on this side is the customer relationship.
How do you acquire your your customers? How do you build a brand?
How do you build loyalty?
How do you make sure that when a customer comes that a customer will come back to buy your product instead of going to your competitor?
How do you engage your customers more? And how do you grow your customer base?
And this is about revenue stream. This is about what value are your customers paying from for?
Where is your revenue coming from? Is it going to be a license subscriptions?
Is it going to be a premium model or a freemium model?
There are all different ways of doing things. Moving to the left side of the canvas.
So this is about your cost structure. And here you need to think what costs you money?
Is it your people? Is it the physical space?
Is it materials that you need to buy? You need to consider both fixed costs and variable costs.
Here, you need to consider your key activities. What are the core activities that require you to deliver your value proposition?
Is it a problem solving? Is it manufacturing?
Key resources. Your key resources are what people have to replicate in order to compete with you.
It's what makes your business unique, and that can be all sorts of things like your code or a patent that you hold or your user base.
But it can also be things like that, a unique set of skills that your team has.
And then finally anything. So finally, the last blog is about partnerships.
Anything you don't do yourselves, you you can outsource it.
And you have to be very strategic with your partnerships. You don't need to do everything yourself.
So, for example, if you need to district to physically distribute your product, you don't need to create a new distribution channel.
You can partner with somebody that has already an established distribution network
or if you want to sell your product online instead of starting from from scratch.
You can partner with a platform that has already millions of users.
So when you're working through this last segment of the canvas, be strategic and think what will help your business move forward?
Some practical some practical tips on using the canvas.
So print it out and put it on the wall. This will give you a good visual picture when you're working on your business.
Don right on the canvas. Things will change a lot and quickly use Post-it notes.
Going through years of customer segment, use different colours for each customer segments and start by exploring as many possibilities as you can.
And then step back and think about it and pick one customer segment that you would like to start with and focus on
that and take all the other Post-it notes out of the canvas and then move forwards and fill the rest of the canvas.
Use for this part gives us less of sticky notes as possible.
So be very specific. And you have to remember, focus on quick communication, not perfect representation.
When you put your your notes, write one or two words.
Nothing more. And keep in mind that every time one aspect of your business changes, it will affect other aspects of your business too.
So every time you learn from your customers, every time you're acquiring new information,
go back to your converse and rethink of all the different aspects of your business.
The compass should be alive. Documents. It's not an exercise that you do once and you file away.
So think about it this way. You go back and you change things.
So you update the compass every time you have new information about your business.
Now, like every other framework, the business model canvas has its limitations,
and one of the limitations is that it doesn't take into account the external environment.
And by external environment I mean threat of new entrants or threat of substitutions.
What if somebody else makes a product that works as well as yours and is exactly solving exactly the same problem as you do?
Will that sink your business or are you in a stronger position than they are?
What if somebody else comes up with a substitution, a completely different product that solves the exact same problem as you?
Well, that creates a problem for your business. Other things you need to think about is the bargaining power of suppliers and and buyers,
but also competition among existing players within the market.
So if you're entering a market that already exists, what is the situation between competitors?
Do you have room to enter? Can you claim part of that market?
For certain businesses. Other factors play a role too, like governmental laws.
So for these type of businesses, you really need to keep an eye on regulation, taxation and trade policies.
And as I said, the business model canvas, although it has its limitations, it's a very powerful tool and it's very simple to use.
It will help you visualise your idea. It will help you organise your thoughts.
And it will help you map out all the different aspects of your business.