Too many business models are similar (is yours creating a differentiated advantage?)

Business model determines how your business will run. A business model is crucial as it represent the way the business makes money. Many businesses fail because of obsolete business model and not differentiated.

They are many business models that exist today, and business models need to be review periodically to make sure it stays relevant and competitive. An outdated business model will cause the business to suffer losses. An undifferentiated business model will draw strong competition, a very red ocean!

The following represent key questions for building business model that differentiate and create blue ocean.

1.??????Your business is where you are today. But what business should you be in? If financial is not an issue, what would your new business look like? Can you recraft your business brand and position it differently so that makes a difference to what you offer to your customers?

2.?????Can you capitalize on all your business core assets, resources, human talents to advance your growth into a new area or niche that is being overlooked now? It’s a good time to re-deploy non value-adding assets. What are the opportunities available for your business to do more with less? What can you reengineer to find those new opportunities?

3.?????Can your business provide additional value-added services to your customers? Normally these are added on Free but with value to create the “wow” moments for your customers. How can you make your products and service more accessible and affordable to a larger market, while maintaining its value? Can it be distributed and charged differently?

4.?????Can you breakdown your current offerings or bundle your current offerings to create a new offering that meet customers preferences? Along with it is to create different price points that makes it attractive to your customers. Relook at your non-mainstream products and services and reposition it by offering them at a very special price so that on aggregate it can a significant revenue for your business.

5.?????Can you change the way your products and services look and feel? Does the current look and feel resonate with your underserved customers?

6.?????Review the cost structure of your product and services. Can you restructure your costing structures so that it provides the most compelling pricing to your customers while maintaining its value?

Having identified the best suited business model, it is important to know what it takes to restructure or implement the new business model. A lot of business owners underestimate the cost, time and expertise efforts that is required to build the business model.

Estimating the cost and developing different cost-benefit analysis requires a deep understanding of what is needed for that business model. Even the amount of time required for it can be miscalculated and there is no back-up plan. The more it gets delayed, the higher the ultimate cost.

Finally, the efforts and expertise that is required to bring the model into fruition cannot be underestimated. Without efficiency in developing and implementing the business model, the financial returns will be grossly undermined.