A revenue model is a plan for how your company will make money and provide a return on investment via selling goods and services.
The sustainability and profitability of your business, in the long run, will depend significantly on your revenue model.
Let's take a quick look at a few of the most popular types of businesses.
Think about your product or service and your target market as you go through these models to determine which will work best for you and help you launch a successful business.
Owner/Landlord model:
A company uses this strategy when it wants to generate revenue by renting out its resources on a short-term basis. These possessions may be real estate (a place to reside) or intangible (data stored on a cloud-based server, such as Dropbox) or a combination of the two (officially licenced Disney character toys).
Also, consider billboards, online services like Google+ and Facebook, and SAAS (software as a service) businesses as other examples.
Creator Model:
Innovators, tinkerers, artists, and authors have a place in this category of business models.
Companies in this category either invent something completely new or improve current goods and services to meet customer demand. These companies are also capable of developing groundbreaking new goods and services.
Large profits may be made by creator model companies when their products and services are so novel that they face little to no competition and when their products are so ground-breaking that the market is not yet ready for them.
Even though creator-model businesses often find success by making significant enhancements to an existing product and cashing in on the market's insatiable need for it, these businesses nonetheless risk falling into the trap of developing offerings that consumers do not want.
Businesses that follow the creator model are frequently seen as dangerous because of the common extremes in their success. Businesses that follow the creator model are said to be either innovative or lag behind the times.
Manufacturing Model:
A company that follows the manufacturing model takes raw resources, transforms them into a finished product, and then sells that product to other businesses or customers in large quantities.
The assembly line, the skilled artisan, metal fabrication, packing and labelling, machining, and the building industry are all examples of manufacturing models.
As the name implies, the company or person placing the order for the manufactured goods takes on the majority of the risk associated with the development of new, unproven goods under this approach.
Wholesaler/ Distributor Model:
Typical "middleman" companies include wholesalers and distributors, which buy in bulk and resell to smaller retailers at a profit.
The primary function of many companies operating under the wholesale or distribution model is to aggregate items of interest and make them easily accessible to retailers.
Numerous sectors, including food production, automobile manufacturing, electronics, and commodity trading, are good examples of this paradigm in action. There is a network of wholesalers and distributors that links together the various links in the supply chain in virtually every business.
Retail Model: Consumers have a lot of experience with companies that use a retail model because of how commonplace it is.
Companies in the retail sector range from the likes of Ikea and NSK to the mom-and-pop stores on the corner.
You support local retailers when you shop for necessities like food, clothing, and household goods. Most merchandise sold in stores comes from wholesalers, the manufacturer, or the retailer's affiliates.
Some retailers take a unique approach by buying worn goods, fixing them up, and reselling them at a profit. Many retailers on sites like Amazon and eBay specialise in selling previously used items, and there are many more that buy their inventory from wholesalers and other offline distributors before reselling it online.
Broker Model:
For enterprises operating under the broker model, the primary source of revenue is the commission earned from the sale of goods or services developed by a third party.
On the Internet, broker-style enterprises like Amazon and eBay have become ubiquitous.
They act as a link between the companies that provide a good or service and the people who wish to buy it or use it in their own operations. As compensation for providing this link, broker companies often charge a flat fee or a percentage of the final transaction price.
Commercial real estate, investment counselling, online marketplaces, and major search engines are all examples of companies that use the broker model.
Subscription Model:
Many online publishers and information sources, from newspapers and periodicals to accounting software subscription services, book clubs, and even Netflix, have adopted this strategy.
Customers generally pay a monthly fee in exchange for access to products the company regularly produces, information the company brokers, or intellectual property the company owns.
Other Business Models:
Other business models exist, some with entirely novel characteristics and others with a blend of the aforementioned elements.
Every conceivable business model would be too lengthy to detail. We've zeroed down on the most widely used frameworks since they're the ones most likely to work for the business you're starting from scratch.
Manufacturing-to-consumer outlet models, B2B models, B2C models, franchise or licencing models, nonprofit models, cooperative models, affiliate models, and multi-level or direct marketing models are some more examples of business models.
Comentarios