What Is a Business Model and Do You Need One?

Business ModelI abhor all forms of business jargon. Always have. Always will. Sometimes it’s unavoidable and I do hope, Gentle Reader, you will pick me up when you notice me using it or ask when I use an expression you do not understand or that you too dislike. I’d appreciate that, honest I would.

Clients ask me, often after they’ve been to networking meetings with other self-employed types bigging themselves up by using jargon and trying to look like they know what they’re talking about, “what’s a business model and do I need one?”

You don’t need one, no. But sometimes they come in very useful indeed. Let me explain.

Put simply, a business model is someone else’s business we can point to which demonstrates that what you’ve got in mind can be done and is the most appropriate way for you to do it. Imitation is the sincerest form of flattery and there is much to be learned by observing how others did it before you and picking the best of their model and applying it to your own business. We can also examine what you don’t like about the way they’ve done it and disregard those bits.

So, for instance, for your business we might look at whether your “model” involves:

Exchanging time for money – when you don’t work you don’t make any money. This isn’t much of a business model, to be honest, but it might be a great way for you to to get started in business or in freelancing. A “proper” business model is something which works without you and which you can sell. But you don’t need to want that… unless you do – eventually.

Are you thinking of a membership site perhaps, where people pay you money to receive access to you and your resources indefinitely? Or a continuity program which has a beginning and an end date? See? Those are two different models, subtle perhaps but distinct.

You’ve written a book. How can you turn that into a business? Who’s done that already? Do you want to do it her way or do you (better) have ideas of your own?

Who do you admire who has raised money by crowdfunding to bring something creative into being and will following his guidelines raise your profile and make you money too? If so, can we rinse and repeat or is that a one-off opportunity?

Ask yourself who has done what you want to do and find out all you can about how they did it. Look for newer and younger, more contemporary inspirations outside the usual tired old dinosaurs who don’t have much relevance to your particular passions or niche. Yawn.

Licensing is a business model, as is franchising. Taking associates into your coaching business counts, as does selling your products using affiliates. And Royalties, they’re a business model too. They are a HOW. That’s all we’re examining, how have they done that, how have they made that work? And how can we create a plan for your business success by modelling others?

Pick my brains. I will be able to run you idea past my mental rolodex of the thousands of businesses I’ve observed and worked with over the decades and we’ll find a business with a model which inspires you. Who’s done what you want to do? Their precedent might help you see your own goals as more doable.

And if there’s no-one? SUPERCOOL! Down to you to create the model then. Check with me first. It doesn’t necessarily mean it’s impossible, but it might mean it’s harder. Or… perhaps – even – easier! I know, BONKERS, right? To boldly go…

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