In this short post, you’ll learn the nine building blocks of a business model.
We’ll use the traditional industrial gas business model for demonstration purposes.
The industrial gas industry serves several segments: manufacturing, chemicals, metallurgy, food, speciality gases, retail and healthcare.
The industrial gas industry helps clients to decrease supply chain costs and increase safety, health and environment of the entire supply chain.
The industrial gas industry distributes gases in different forms: gaseous, liquid, pipeline and on-site supply.
Sales channels are direct sales to key accounts, high growth medium size clients. Depot partners serve small users.
The industrial gas industry maintains close relationships with its clients via sales personnel, customer service centres.
To solve customer problems on the spot.
Revenue stream results from the value proposition of optimizing the total industrial supply chain costs.
Traditionally the industry generates income from product sales per volume, cylinder , from services such as cylinder rent, tank rent, manifold rent, on-sites and equipment sales.
Critical resources are the assets required to offer and deliver value. The gas industry offers a complete automated order fulfilment channel. This is convenient for clients because they don’t need to take care for ordering.
Key activities for this business models are to manage the order fulfilment process. The goal is to continuously optimising supply costs of the entire supply chain.
Partners provide non-core activities. Freighters, independent entrepreneurs who act as commissioners, and engineering companies who deliver turnkey manifolds and tank installation projects.
The main cost categories of a typical industrial gas company are:
– cost of goods sold ( production, distribution and service costs),
– selling expenses (direct selling and sales administration costs),
– administration costs ( finance and controlling costs).
Now we’ll design a digitalised business model for the retail sector:
The customers in the retail area are: plumbers, locksmiths, laboratories, restaurants
Our value proposition is to offer automatic inventory management, i.e. automatic re-filling of cylinders and equipment
Customers can contact us on www.communitybuilder.com in case of problems. Deliveries, however, are done automatically by small, branded vans.
Building a community of retailers where they will exchange their experiences.
Recurring income from membership fees (golden, silver, free)
Critical assets are the brand and the digital platform.
Key activities are: designing the brand, creating and managing the digital platform, managing the partner fleet.
Branded, independent forward freighters contractors deliver services to end-users.
The main cost categories are:
– development costs ( branding, business model, fleet development
– operation costs for managing the system and fleet management