#small business advice
The 5 Worst Pieces of Advice for Small Business Owners
When you’re starting a business, there’s no shortage of people eager to hand out advice. It seems that everyone, even someone you’ve just met, has an opinion on how you should be developing your product, running your marketing, handling your finances and much more.
I’ll be the first to admit that I’ve met some very smart people and have had great mentors over the years. Their contributions have been invaluable to my success. Yet after launching two companies over two decades, I’ve come across some terrible advice.
Below are the top five bits of advice that I could have done without.
1. “Hire people you know.”
I’ve had countless people tell me that it’s always better to assemble a team of “known quantities” — friends, colleagues or former employees whom you know and trust. But I’ve discovered that for me, the best hiring decisions are based on the specific positions I need to fill at that moment in time. In other words, I need to focus on the specific expertise and skill sets the company needs, rather than trying to piece together how Jill, Sally and Joe will fit into the new business.
In addition, if things aren’t working out between an employee and your company, you need to part ways (and usually, the sooner the better). You may be more reluctant to let friends go, even if you know they aren’t good fits.
2. “There’s no room for you in the market.”
When my husband and I launched a legal document filing company the second time around, the field was quite crowded, with several big names and established players. Many people told us to find a new space because there simply wasn’t room for us to compete.
However, the key to business success doesn’t always hinge on finding a completely empty field; rather, it’s how you define your company and its place in the market. Starbucks wasn’t the first company to sell coffee, but they did revolutionize the coffee shop by selling an experience along with a caffeine fix. Still, numerous boutique coffee shops are able to open and thrive today, even though there’s a Starbucks around the corner.
Rather than struggling to come up with a brand new idea, take a look at your target industry and see where there’s a void to be filled. Figure out the best possible way to fill that need and run with it. You don’t always have to blaze a new trail, but you need to know who you are.
3. “You have to be cheaper than the other guys.”
I admit that my husband and I fell into this pricing trap with our company. We felt that the only way we could compete with the “big guys” was to undercut them on price. So, we dropped our prices. Our business grew, customers were happy, more customers came in, yet we were nearly losing money with every new order.
Many young companies feel the pressure to discount their prices heavily in order to win business. While customer acquisition is important, attracting customers at unsustainable price levels will just result in a race to the bottom. I’ve learned that you’re better off in the long run to focus on how to bring more value to customers, rather than simply slashing your prices. After all, someone will always be able (or willing) to absorb a lower cost than you. You’ll need to find a new way to stand out, and then work as hard as you can to be exceptional in those differentiating areas.
4. “Social media is free.”
Over the past several years, I’ve had people tell me that starting a small business today is much easier than a decade ago, because of all the free marketing on Facebook. Twitter and Yelp. Sure, you don’t have to spend a dime to join Facebook, create a Twitter account or start a blog. But, I think a more apt comparison is that social media is free like a puppy. It may not cost much to bring a shelter puppy home, but from day one, it’s an endless whirlwind of training, toys and treats.
Likewise, social media is far from free once you factor in the blood, sweat and tears it demands. From developing fresh content to keeping up conversations, social media requires nonstop commitment once you start. Unless you consider your time (or the time of your employees) worthless, then there’s a significant cost involved with social media.
5. “You have to spend money to make money.”
This cliché never applied to our business, particularly at the beginning. We set up shop in our apartment and did everything we could to keep expenses down. Sometimes we thought things would be better if we just had the money for X, Y or Z. But it’s risky to think that throwing money at a problem is your silver bullet. Sometimes, creative thinking and strategy work far better than a checkbook.
We had to learn the difference between spending money and investing in the business. Certainly, money can scale a business faster, but only when you spend money on those things that will produce more money in return.
People will always give you advice — some good, some bad. The key is to never forget that you are running the show. Other people’s opinions should always be viewed through the context of your own experiences, convictions and value system.
Final decisions are always up to you, so there’s no blaming someone else for bad advice.
#small business resources
Small Business Resources
The Greater Flagstaff Chamber of Commerce provides numerous business support services and acts as a conduit for business and business service providers. See below for information regarding our business partners and the local, state and national based small business support organizations.
Visit our other economic development, divisions and initiatives for more information about how the Chamber can help you.
Below is a list of helpful links for small businesses to use as a resource.
flagstaffprospector.com: Provides demographic information on the City of Flagstaff and Coconino County. Includes information on consumer expenditures, types of existing businesses, and workforce information. Search engine for commercial property for lease or sale by size and type.
AZ Department of Commerce
azcommerce.com/programs-and-services/small-business-services/: Provides small business services including online resource guides and checklist, information on business licensing, statewide resources, certification programs, commerce incentive programs and education programs.
AZ Department of Revenue
aztaxes.gov. Arizona business license links, business tax description codes, and Arizona Department of Revenue links.
Arizona Small Business Association
asba.com. Offers workshops and seminars for every stage of business growth, from infancy to second-stage and beyond. For a fee membership, business owners and entrepreneurs get to access education, technology and B2B marketing opportunities and free, applications that are not available to non-members.
Arizona Small Business Development Center Network
azsbdc.net. AZSBDC is an innovative partnership between the state’s ten community college districts and the U.S. Small Business Administration. The network is the largest and most accessible source of assistance to Arizona businesses with fewer than 200 employees. Helps businesses address challenges to help them reach their full potential. 13 centers throughout the state.
Coconino Small Business Development Center
coconinosbdc.com. Has assisted more than 100,000 small businesses in the last 15 years. Offers confidential business counseling, training seminars and customized training.
History s 10 greatest entrepreneurs
By Philipp Harper
Special to msnbc.com
How many entrepreneurs have there been in the history of the world? Millions, certainly, probably even billions. These are the men and women who take capital — their own or somebody else’s — and use it to beget more capital. Some fail, some succeed, some excel.
With so many candidates to choose from, any list of the 10 greatest entrepreneurs of all time will necessarily be somewhat arbitrary. It will also be top-heavy with Americans, just as a list of great chefs would be disproportionately French or of great eccentrics dominated by the British.
Business is what America does. If that sounds chauvinistic, get over it.
Here, without further ado but with tongue occasionally in cheek, are history’s 10 greatest entrepreneurs.
1.King Croesus. A pick by our veterans committee, Croesus, who ruled the Asia Minor kingdom of Lydia in the sixth century B.C. is owed a huge debt of gratitude for minting the world’s first coinage, thereby creating in a single stroke the lifeblood of every business: liquidity and cash flow. Moreover, his opulent lifestyle has given entrepreneurs throughout history something to shoot for. Is there a greater distinction for the commercially inclined than to be deemed “as rich as Croesus”?
2.Pope Sixtus IV. Sixtus gets the nod for realizing that the “wages of sin” meant more than unpleasant repercussions. There was money to be made in damnation, and Sixtus mined it by opening up a new market — the dead — for the indulgences the church had been selling for years. Relatives of the deceased quickly filled the Vatican’s coffers with payments intended to lessen the time their loved ones spent in purgatory. In 1478 Sixtus “grew his market” by authorizing the Spanish Inquisition, which swelled purgatory’s ranks by 100,000 souls in 15 years. He also was the first pope to license brothels.
3.Benjamin Franklin. In a real sense, Franklin was America’s first entrepreneur. Unlike other of the Founding Fathers — the hypermoral Washington, the prodigiously intellectual Jefferson — whose virtues and attainments are seen today as anachronisms, Franklin truly was a model of what many of us would become. Beneath the statesman’s mantle resided a popular author, a printer, an inventor (the lightning rod, bifocals) and a very savvy businessman who knew how to commercialize the fruits of his fertile mind.
4. P.T. Barnum. Americans have always loved a good scam and Phineas Taylor Barnum took the art to new heights. He played on our fascination with the bizarre and freakish with sideshow acts ranging from the midget Tom Thumb to Jumbo the giant elephant. In between was a host of more dubious curiosities. He created the Barnum and Bailey Circus as a showcase for all this wonderment, and dubbed it “the Greatest Show on Earth.” Along the way he invented modern advertising and became rich. For the record, he never said “There’s a sucker born every five minutes,” but he left behind plenty of other bon mots. Among them: “Every crowd has a silver lining.”
5.Thomas Edison. What do you say about the man who gave the world the electric light, the phonograph, talking motion pictures and more than 1,300 other patented inventions? That he was the world’s greatest inventor, certainly. But he was also able to exploit the profit potential in his creations, an entrepreneurial bent that asserted itself when Edison was a teen-ager, printing a newspaper in the baggage car of a rolling train and then selling copies to passengers. His impact on the way people live was and is pervasive. As a combination of inventive genius and entrepreneurial flair, he stands alone.
6.Henry Ford. Ford also fundamentally changed human lifestyles by making available a vehicle, the Model T, that vastly extended people’s range of movement. The automobile would allow America’s masses to fulfill their Manifest Destiny to populate every corner of the continent. But his more profound impact was on industry. The moving assembly line he designed to build his cars was the signal breakthrough of the Industrial Age. Appropriately, Ford earned the seed capital for his enterprise by working as an engineer at the Edison Illuminating Company in Detroit.
7.Benjamin Siegel. Known as “Bugsy” to his friends, Siegel was a notorious mobster with a touch of the visionary. Legend has it that he single-handedly invented Las Vegas, and that’s a stretch. But he was the first to see what the town could become: a lush oasis of pleasure where gambling was just one of the attractions. He also proved adept at attracting other people’s money to build his iconic resort, The Flamingo. Trouble was, some of those other people belonged to an outfit called Murder Inc. and Siegel was gunned down in 1947 amid rumors he had stolen from his partners. But give the devil his due: Before there was the Bellagio, there was Bugsy.
8.Ray Kroc. Nothing says entrepreneur like persistence, and nothings says persistence like Ray Kroc, the kitchen wares salesman who in 1954, at age 52 and in poor health, had his imagination hijacked by a family-run restaurant in the desert outside Los Angeles. Once he had bought out the McDonald brothers, Kroc proceeded to take their concept of a limited menu, fast service and low prices and expand it nationally, in the process creating the fast-food industry and dramatically affecting America’s lifestyle and, sadly, collective health.
9.H. Ross Perot. Within every entrepreneur lurks a touch of the cowboy, and there’s no better example of the strain than Perot, the diminutive Texan who has become best known in recent years as a political gadfly. Before that, though, he was all business, using a $1,000 loan from his wife in 1962 to launch Electronic Data Systems. Perot’s winning idea was that large corporations and organizations needed data-processing help if they were to take full advantage of computer technology. When in the mid-’60s he won contracts with two new federal health-care programs — Medicare and Medicaid — EDS was off and running and Perot was on his way to being one of America’s richest citizens.
10.Jobs & Wozniak. Apple Computer’s two Steves weren’t the first Silicon Valley entrepreneurs to launch a billion-dollar business from a Palo Alto garage — Hewlett and Packard were there before them — but they were the first to democratize computing by creating a machine whose use was so wonderfully intuitive that even technophobes embraced it. Combine the elegance of Wozniak’s operating system design with Jobs’ marketing savvy (remember Apple’s “1984” ad?) and the result was a true phenomenon. Yes, the Apple was eclipsed by the PC, but only after Microsoft (behind the vision of two other notable entrepreneurs, Bill Gates and Paul Allen) developed Windows to ape its rival’s ease of use.
Philipp Harper is a freelance journalist living in south Georgia.
You have unlimited possibilities for success at Tennessee State University. We’re a leading institution of higher learning and provide students with the opportunity to experience academic and personal growth. You’ll receive instruction from top-notch faculty and be immersed in research, service learning, and student life activities, including internships, cultural, and study abroad opportunities.
Our world-class faculty will teach you how to apply what you learn in the classroom to real-world situations. As a student, you will become a problem solver and critical thinker. You may begin the admissions process by submitting your application. The university also assists in providing information on financial aid services, work-study, fellowships and scholarships based on eligibility and other rules and regulations established by the agencies.
Tennessee State University students go by the motto: “Think. Work. Serve.” But we also realize a little fun should be part of the collegiate experience to create a holistic approach to learning. With a variety of social, professional and civic clubs for students to participate in, there are many opportunities for you to share your time and talents and enjoy connecting with your fellow students to create the work-life balance needed for success in college and beyond.
Tennessee State University counts on the generous contributions of alumni and friends to fulfill our mission of providing a top-notch, affordable education to the best and brightest students. Every gift, no matter the size, makes a difference. When you support TSU, you help provide critically needed scholarships, departmental support and other special project funding that benefits our students.
Tennessee State University is engaging in cutting-edge research to address critical challenges in our society. Our research arm supports faculty and students by taking their ideas from conception to fruition in critical areas such as biotechnology, homeland security and agriculture, to name a few. Our Centers of Excellence encourage collaborative and experimental learning opportunities and help expand the boundaries of science, education and technology.
Tennessee State University Athletics is part of the Ohio Valley Conference (OVC) NCAA Division Ⅰ and offers football, men’s basketball, women’s basketball, track and field, golf, tennis, softball and volleyball. We provide student-athletes with a positive academic and social environment to excel on and off the field. Our mission is to blend physical, emotional and intellectual development into one experience. We not only build winning-teams, but leaders in the classroom, in the community and in your profession of choice.
Tennessee State University is a world-class university known for academic excellence, incredible students, inspiring faculty, exceptional value and an amazing campus and community. We invite you to learn more about TSU and our academic programs, admissions process, tuition and financial aid, campus visits, student housing and more.
Tennessee State University is dedicated to helping students develop the skills needed for the real world. Our vibrant campus life, leadership opportunities, rigorous academic programs, access to scholarships and student services are just a few of the student services we offer. We are preparing career-ready professionals today for knowledge-based jobs tomorrow. The Tiger legacy continues with you.
TSU loves parents! And we encourage you to stay involved with your Tennessee State University student. We strive to make the transition to college and beyond flow as smoothly as possible for everyone. We’ll keep you up-to-date on campus happenings through a monthly eNewsletter, a helpful Parent Guide and through many other programs and events. We’re here to help you and your student make the most out of your TSU experience.
At Tennessee State University, our blood runs blue! We enjoy connecting, socializing and sharing news about the great things our alumni are doing across the globe. From our annual Homecoming celebration to donor events and volunteer activities, TSU alumni always find time to celebrate what it means to be a Big Blue Tiger. We welcome you back to campus anytime to rekindle your most memorable experiences.
Welcome to Tennessee State University, located in the heart of Nashville, one of the nation’s most progressive cities! Whether you are here for your first visit, planning a campus tour or returning after many years away, TSU welcomes you to enjoy our facilities, hospitality and our unique history and contributions.
Tennessee State University is proud to have 1,200 distinguished administrators, faculty and staff members as part of our team. With outstanding reputations for teaching, research and service, these professionals make valuable contributions to our community of scholars and ensure that TSU is a thriving public institution of higher learning.
The College of Business is uniquely poised in the heart of downtown Nashville as a strong, robust, and expanding educational, entrepreneurship and research engine, positively impacting the entrepreneurial and economic tapestry of Nashville, the State of Tennessee, and the world. Through innovative teaching, research focused on contemporary business concepts, and a culture anchored by a commitment to service and life-long learning, the college’s approximately 900 undergraduate and graduate students are prepared by a dedicated and culturally diverse faculty for global economic success.
The TSU College of Business Story.
- The first business school in Nashville to earn dual accreditation from the most prestigious accrediting body for business schools in the world, the Association to Advance Collegiate Schools of Business (AACSB International )
- Selected by the Nashville Scene Magazine in 2012 as one of the top 3 MBA Programs in Nashville. The TSU MBA offers concentrations in:
- Management of Information Systems
- Supply Chain Management
- Internationally recognized faculty, all holding doctorate degrees, published more than 400 scholarly works within the past 5 years.
- New collaborative MBA program with Tianjin Polytechnic University in China.
- The College edits, publishes, an international scholarly publication, The Journal of Developing Areas.
- The College has a state-of-the art Financial Trading Room.
- Bachelor of Business Administration Degree in:
- Business Administration
- Business Information Systems
- Economics and Finance
- New Undergraduate Concentrations in: Hospitality Management, International Business
- Globally recognized Supply Chain Management undergraduate and graduate programs
- Two distinguished endowed Chairs of Excellence in Accounting and Banking Financial Services.
- The College has strong corporate and business leadership support through our 5 boards of advisors.
Our mission is to educate current and future business professionals through innovative teaching and research focused on contemporary business concepts for the global economy, complemented with a commitment to service and lifelong learning.
How we see ourselves…
The College of Business strives to achieve national and international prominence in educating current and future business professionals for the global economy
When you choose the College of Business, you benefit from our small class sizes and the practical experience of our notable faculty. All full-time permanent faculty in the College of Business hold doctoral degrees and follow our guiding principles and core values:
With flexible class schedules—day, evening, and weekend offerings—and innovative teaching that integrates business ethics, international business, and computer applications, you’ll be well prepared to compete successfully in the global marketplace, whether you travel around the world or find your niche in Nashville.
BE A PART OF THE BIG BLUE BUSINESS FAMILY
Whether you envision a start-up from scratch or you have your sights on the C-suite of a Fortune 500 company, you can make your mark with a degree from our exciting programs.
Preparing You for a Professional Career
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#owning your own business
The Benefits of Owning Your Own Business
There are many benefits to owning your own business:
- Your years of hard work can result in wealth not unemployment
- For the self employed, just about everything is a tax write off
- You will eventually have the ability, money and time to help others
- You will eventually have more time to spend with your family
- You will eventually have more self-esteem
- You will eventually have much more freedom
Here is my personal perspective. When I look around at the friends and colleagues I have known and worked with, the happiest and most satisfied people are those that own their own businesses. They have the most freedom, and the most control over their lives, even more than most CEO’s I know.
And that’s because CEO’s can be fired. Even if they are really good. Being in top management does not necessarily give you more control over your future.
I’m not saying that being an employee is bad, but if you have an opportunity to be self employed you should consider it carefully.
Yes, I know some CEO’s who are on top of the world, and I am very happy for them, They worked hard and smart. They took very good care of their people. They made some unbelievably brilliant strategic decisions. They made a lot of small decisions that added up to something big. They truly deserve their success.
On the other hand I know many high level executives, including CEO’s, who are currently unemployed because someone fired them. Whether they deserved it or not, even at a high level, they were not in control of their destiny.
As an employee you can dedicate many years of your life to a company, only to find yourself out of a job due to situations totally out of your control. Management changes, mergers, acquisitions, downsizing and outsourcing all have a tendency to force sudden and unexpected change.
On the other hand, if you own your own business, you will still face competition, change, legal battles etc. But in every case you will have time and an opportunity to fight and win. Big difference.
However, the risks in starting your own business are far greater than if you were an employee who worked for someone else.
According to Michael Gerber, author of The E-Myth. in the US, there are over 1,000,000 new businesses started every year. 40% of these fail in the first year. Another 40% fail before year five. So the odds are against you.
There are ways to beat the odds. The success rate for franchises is much higher. Something like 50% or more of the franchises make it past five years.
The key according to Michael Gerber is that franchises offer you a proven Turn Key business.
However, franchises are still very risky. We know people who lost a lot of money on franchises and are still not self employed.
If you are planning your future, and you eventually want to be able to slow down and have some money to retire on, you have three main long term career choices:
What are your choices for ensuring you can someday retire:
- Try your hand at building your own business i.e. being self employed. Build it big enough that it not only pays for your retirement but that you could sell if you wanted.
- Be an employee and make sure you earn enough and save enough for when you retire, or when you get laid off or fired. Remember, high level executives are not immune from being fired.
- Get a government job, because most government jobs have retirement plans and pensions. Military folks and city employees usually get to retire with a full retirement plan paid for by our tax dollars. I’ve seen some folks who have two retirement plans, one from the military and one from a city, state or federal job.
#types of business
A business is an organization that uses economic resources or inputs to provide goods or services to customers in exchange for money or other goods and services.
Business organizations come in different types and forms.
3 Types of Business
There are three major types of businesses:
1. Service Business
A service type of business provides intangible products (products with no physical form). Service type firms offer professional skills, expertise, advice, and other similar products.
Examples of service businesses are: schools, repair shops, hair salons, banks, accounting firms, and law firms.
2. Merchandising Business
This type of business buys products at wholesale price and sells the same at retail price. They are known as buy and sell businesses. They make profit by selling the products at prices higher than their purchase costs.
A merchandising business sells a product without changing its form. Examples are: grocery stores, convenience stores, distributors, and other resellers.
3. Manufacturing Business
Unlike a merchandising business, a manufacturing business buys products with the intention of using them as materials in making a new product. Thus, there is a transformation of the products purchased.
A manufacturing business combines raw materials, labor, and factory overhead in its production process. The manufactured goods will then be sold to customers.
Hybrid businesses are companies that may be classified in more than one type of business. A restaurant, for example, combines ingredients in making a fine meal (manufacturing), sells a cold bottle of wine (merchandising), and fills customer orders (service).
Nonetheless, these companies may be classified according to their major business interest. In that case, restaurants are more of the service type they provide dining services .
Forms of Business Organization
These are the basic forms of business ownership:
1. Sole Proprietorship
A sole proprietorship is a business owned by only one person. It is easy to set-up and is the least costly among all forms of ownership.
The owner faces unlimited liability ; meaning, the creditors of the business may go after the personal assets of the owner if the business cannot pay them.
The sole proprietorship form is usually adopted by small business entities.
A partnership is a business owned by two or more persons who contribute resources into the entity. The partners divide the profits of the business among themselves.
In general partnerships, all partners have unlimited liability. In limited partnerships, creditors cannot go after the personal assets of the limited partners.
A corporation is a business organization that has a separate legal personality from its owners. Ownership in a stock corporation is represented by shares of stock .
The owners (stockholders) enjoy limited liability but have limited involvement in the company’s operations. The board of directors. an elected group from the stockholders, controls the activities of the corporation.
In addition to those basic forms of business ownership, these are some other types of organizations that are common today:
Limited Liability Company
Limited liability companies (LLCs) in the USA, are hybrid forms of business that have characteristics of both a corporation and a partnership. An LLC is not incorporated; hence, it is not considered a corporation.
Nonetheless, the owners enjoy limited liability like in a corporation. An LLC may elect to be taxed as a sole proprietorship, a partnership, or a corporation.
A cooperative is a business organization owned by a group of individuals and is operated for their mutual benefit. The persons making up the group are called members. Cooperatives may be incorporated or unincorporated.
Some examples of cooperatives are: water and electricity (utility) cooperatives, cooperative banking, credit unions, and housing cooperatives.
#types of business
Business Entity Types
To get the most out of your small business, choose the right structure. Selecting the right type of company or corporation for your new business helps maximize your chances of financial and operational success.
Common types of business structures and corporations include C corporations, limited liability companies (LLC), partnerships, S corporations, and sole proprietorships. Learn more about each type of business or corporation:
Limited Liability Companies (LLCs)
- Independent legal structures separate from their owners.
- Help separate your personal assets from your business debts.
- Taxed similarly to a sole proprietorship (if one owner) or a partnership (if multiple owners).
- No limit to the number of owners.
- Not required to hold annual meetings or record minutes.
- Governed by operating agreements.
- Independent legal and tax structures separate from their owners.
- Help separate your personal assets from your business debts.
- No limit to the number of shareholders.
- Taxed on corporate profits and shareholder dividends.
- Must hold annual meetings and record meeting minutes.
- Independent legal and tax structures separate from their owners.
- Help separate your personal assets from your business debts.
- Owners report their share of profit and loss in the company on their personal tax returns.
- Limits on number of shareholders, who must be U.S. citizens or residents.
- Must hold annual meetings and record meeting minutes.
- Partners remain personally liable for lawsuits filed against the business.
- Usually no state filing required to form a partnership.
- Easy to form and operate.
- Owners report their share of profit and loss in the company on their personal tax returns.
- Owner remains personally liable for lawsuits filed against the business.
- No state filing required to form a sole proprietorship.
- Easy to form and operate.
- Owner reports business profit and loss on their personal tax return.
Review our Business Comparison Chart for more details. Regardless of business structure you choose, incorporate.com can help you incorporate or form an LLC online or by phone for less than the cost of using an attorney.
Ready to Form a Business? Get Started
Design your business model:
Excel is not the most engaging innovation tool, is it? Discussions on business models often end up in total confusion. You re talking about multiple revenue streams, tens of partners, and many transactions going back and forth. It s pretty hard to keep all information top of mind, let alone be creative. That s why we developed a visual brainstorm method for this kind of challenges! Perfect for individual and team brainstorms about new business ideas. For those who are familiar with the Business Model Canvas by Alex Osterwalder. this methods works in perfect harmony!
“If you think designing a business model is complex, difficult or boring…you must try the Business Model Toolkit from the Board of Innovation! It is simply brilliant, easy and flexible at the same time. The toolkit is an amazing way of seeing and designing business models.” Maria Ana Neves, Sintese Azul (UK)
UPDATE:Get on the waiting list and be first in line to receive our new business model kit! We ll send you a notification once they are ready to ship!
So how will this tool help me?
This brainstorm kit visualizes how you plan to make money. You can set up different revenue models to compare during your brainstorm sessions. The kit is perfect to present your business idea to a large group. This tool has been developed by the Board of Innovation to bring you one step closer to bringing your idea to reality.
How do I use this tool?
Find an inspiring spot and ideally some bright minds
Start by naming all the (potential) actors in your ecosystem
Map out the initial transactions with your customers
Add other transactions with suppliers, partners, and other stakeholders
Design new business model scenarios and play around with it
Find inspiration in successful business model examples
16 BLOCKS TO VISUALIZE YOUR BUSINESS MODEL
All our business model examples are visualized with this set of 16 building blocks. To give more insight in how this works, we give a brief overview of the different building blocks. Using a common, visual language enables you to easily communicate business models to different audiences, to learn from successful models in other industries, and to quickly generate new variations and business models of the future.
Once you grasp the building blocks below, check out our business model tools to design your own business model in seconds. Share the results in your organization and let us know what you think about this method.
1. YOUR ORGANIZATION
This is where your business model starts to get shape. Place this block in the center and build your model around it.
2. THE COMPANY
The second most important block is the company. In most models this will be the actor that offers a product or service.
3. THE CONSUMER
The one that receives the product and gives something in return, is the consumer. In B2B models, the client is a company and will therefore be illustrated with the previous company icon. The general company-client relation is the same in both business systems.
Although we prefer not to include much of the secondary stakeholders, sometimes it is relevant to show how the supplier side of a business system works. This icon can also be used for service suppliers like web or marketing agencies.
Unions or charity organizations are not focused on making money but often they do haven an impact on your organization. If relevant you can add this player to the system.
Many companies do not like the involvement of a government on their business model, except when they have some money to offer.
The first, most straightforward offer to clients is an actual product, ranging from basic commodities up to finished goods. A BMW car is one example, but today also digital products can be included.
A first way to upgrade your business model is to offer a service next to the product. BMW in this case will not only sell you a car, but will include maintenance and other services around the product. Of course, a lot of companies offer only services without product.
The two concepts of product and service are commonly applied throughout our economy. In the last years, several companies have moved a step further by offering an experience to customers. BMW does not sell a car with a service in this case, but a driving experience.
The typical currency that clients pay with, is money which is critical to company s revenue models. This is in contrast to exchange. The building blocks make a differentiation between two types of money. This first icon represents the normal value of a good, including profit.
11. LESS MONEY
This second icon represents money as well, but less than the normal amount covering cost and profit of what is offered. Usually this transaction implies that other revenue streams are added to the traditional business model.
Today, the next upgrade to reputation can only be found in a few sectors. In these cases, ‘reputation’ selling can be described as the most essential brand experience. If you take the example of BMW, then you could say that some people don’t see their BMW as a driving experience but as the core values and reputation of the brand as such. Hereby, customers are able to shape their own identity with that of the company. Typically reputation will be placed in the top of Maslow’s hierarchy of needs, which makes this type of transaction extremely valuable to companies.
Active exposure or attention is the next step in the evolution of currency. People are not only offering their own attention, but also that of their peers in their social environment. For some businesses the spreading of their ideas and brand values becomes more important than the immediate return in money. Of course, companies can’t just rely on active exposure, so their business model should include more players and other transactions. Many start-ups and even big web 2.0 companies are still struggling with this. There is a lot of exposure and value offered to clients, but there is no sustainable business model to capture that value in revenues and profit.
(Virtual) credit systems are on the rise. Therefor we have to add them to the business model blocks as well. Loyalty cards and similar are also covered
Information is one of the key items that’s being transfered in modern business models. Depending on the context a mixture of ‘information’ related items (content, data, knowledge, articles. ) are being used in relation to this block.
Ownership rights, IP and even the right to emit CO2 are items that stakeholders can exchange between each other. This must be the most abstract block but is necessary to illustrate the innovativeness of several models.
These giants already found new business ideas with our kit:
The Best 200+ MBA and Business Blogs of 2016
Great tips and knowledgeable advice can be among the key ingredients of your success. That’s why we’re here. Offering our top recommended business blogs of 2016, we guide you in the day-to-day aspects of making successful business decisions. Consider us your own personal mentor.
There’s no wonky business jargon here, just real-life situations and terrific ways to solve them. From HR and management matters to B2B and conversion optimization, to name a few, our blogs deliver a wide range of practical solutions directly from experienced professionals to you.
Weeding through resumes, finding the best talent, holding on to that talent once you hire them — yes, these elements keep an HR office chugging along. Yet there’s so much more to successful HR. It’s all in the details. Take corporate culture, for instance. No one wants to work in a hostile environment or under “that” boss. You know what we mean. That’s why we have a blog that guides you through that minefield.
Flexible schedules, social media policies and negotiating pay raises are just a few other hot-button issues among the many other topics we cover in our HR blogs. If it’s relevant to your everyday life in HR, we have a blog about it.
The problem with that old saying about “the buck” stopping here is that managers have to figure out what to do with that buck. That’s where our management blogs come in. Supporting both current and aspiring managers, our blogs underscore leadership and its value to employees. Sure, management is all about supervising people, but the main component of that is leadership.
However, that’s not all. Another blog spotlights the unique issues of women in management while another focuses solely on project management students. Even our many leadership blogs underscore diverse areas. You won’t need to pass the buck when you boost your management skills with our blogs.
Gone are the days of the lonely accountant, hunched over a desk, adding numbers in solitude. Cutting-edge technology has changed all of that. Cloud accounting, for example, and QuickBooks tailored to client needs are just the start. How about early-retirement planning — there’s a program for that. You can even develop household budgets online. It’s all a matter of combining technology and finance. Our blogs explain the details.
Of course, there’s also the personal side of finance. You’re building client loyalty one moment and working on ways to praise your team more effectively the next. It can be hard to balance it all. To keep up with the financial trends and offer accounting with a personalized touch, our blogs are the resource.
When it comes to promoting products, catchy jingles and memorable tag lines are not enough. Where you market matters, from social media to podcasts. How you market counts, too. Yes, that means technology again. Then there’s branding. After all, how else will customers identify you?
If it all begins to feel a bit overwhelming, relax. Our blogs have you covered. Offering savvy tips and on-point advice, our marketing blogs give you that extra help. Whether it’s a new marketing strategy or a digital marketing plan, we offer it. Perhaps it is repackaging that you need. Or maybe a little market research is in order. Whatever your business needs, our marketing blogs boost both the new entrepreneur and the established business owner.
Sure, you may have built your business through your own effort, but you won’t keep it thriving that way. For that, you need other businesses. Yes, you know all about the need for a strong web presence and the power of SEO. These elements connect you to businesses that are vital to yours. Yet, what good is a connection if you don’t make the most of it? Our B2B blogs show you how.
For instance, how much do you know about sales enablement? What about social selling — how does it really affect your business? Plus, getting Sales to make better use of sales content is a problem for almost everyone. Here’s the good news: Our B2B blogs have these answers and much more.
Blogging and Content Blogs
People like to feel important. It’s that simple. Here’s another simple fact: Blogging gives you an opportunity to tell them how important they are to your business. Interestingly, this turns people into customers, and that translates into more business. Yes, it really is that simple.
It’s also that complicated. You see, reaching the right audience for your business is essential. So is offering the content that they want to read. Of course, presenting it all in an engaging way certainly helps. That’s why we offer blogs about blogging, providing you all of the blogging secrets you need to know. Besides, with these results, making others feel important can make you feel pretty special, too.
Conversion Optimization Blogs
Meeting new people is easy. Converting them into customers — better yet, keeping them as customers — can be a different story. Yet a little analysis can go a long way. Naturally, that’s exactly what our conversion optimization blogs offer.
For example, have you ever seen a website formatted precisely as you’d like? We have a blog to help you copy the coding. What about email marketing? Our blogs can revolutionize your emails, drawing in many more customers. Plus, when was the last time you tweaked your website copy? Let our blogs help you update that. From websites and emails to dashboard reports and analyzing your customers, our conversion optimization blogs help you convert people into customers.
Being an entrepreneur can be somewhat of a juggling act. You have your goals and objectives in one hand and all your responsibilities — from marketing and e-commerce to accounting and technology — in the other. Keeping all of those balls in the air is no easy matter. That’s where our entrepreneur blogs can help.
They provide all of the support that a new entrepreneur needs. You’ll learn to choose the tech tools you need and forget the rest. When you implement that great new idea, our blogs will help you protect them. Our have blogs that offer tricks of the trade that impress even seasoned entrepreneurs. Supporting your franchisees and ways to make your business global are just a few examples. If you’re ready to fly as an entrepreneur, our entrepreneur blogs will help you soar.
Sales is the “little engine that could” in your business. Without their efforts, your business flounders. Yet, with the wrong approach, you might as well have no Sales department at all. It a winning combination of confidence and strategy that will make your business. That’s why you need our sales blogs.
Filled with tips on optimizing sales and selling to the most challenging customers, our blogs get right to the point. They offer techniques, too. From ways to conduct a virtual sales kickoff to the best time management ideas, these sales blogs will take your business to a higher level.
Social Media Blogs
Facebook, Twitter, Instagram, Snapchat, YouTube — you can’t escape social media. However, since you’re in business, you don’t want to escape. It’s your virtual goldmine. For drawing new customers, chatting with current ones and, always, promoting your business, social media is the way to go. If you’re not in it, you really need help. If you are in it, you may need even more help. Fortunately, the help desk is always open: our social media blogs.
Our blogs will tell you the best way to use YouTube videos on Facebook to showcase your new product. They tell you the secrets to selling your business with one simple sentence on social media. They will even help you launch a successful digital marketing campaign. What are waiting for? Social media is calling.
MBA and Admissions Blogs
The business world is beckoning to you, and you can’t wait to answer that call. As an MBA student, you will gain all the tools you need. Perhaps you ll be an entrepreneur with a business that everyone is talking about. Maybe you ll be that business executive who quiets a room just by entering. Who knows? The one thing you do know is that you have to get into business school first. Our blogs can help.
From Harvard Business School interview reports and finding the best business school for you to great tips on summer internships and available jobs, our MBA and admissions blogs address the needs of MBA students. Our blogs take care of the hard parts for you. You need only read them.
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