The information from this article is based on an interview with Ashley Mitchell on the #StraightofftheBATT live show. Ashley is the Managing Director of Enterprise Hub Limited and has considerable experience in enterprise development within Trinidad and Tobago, the wider Caribbean and the United Kingdom.
If you think of your home and the different rooms it comprises and the functions of those rooms, you can easily envisage a business model. According to Mitchell, if you take a panoramic view of a house plan you can look at the various elements of your business model and see how they can come together in a synergistic way to give you the best chance of not just surviving, but actually succeeding, thriving and growing.
What does a business model include?
A business model looks at elements like:
- Your customer segments – for example, whom you are targeting and who are these stakeholders or other organizations that you’re targeting with your business.
- What is the value proposition for each of these targeted segments – for example, what is the value that you’re creating for them?
A business model essentially answers three questions:
- How do you create value?
- How do you deliver that value?
- How do you capture value back for your business?
What considerations should business owners undertake when it comes to remodeling their business?
There are a number of external factors that affect businesses that can prompt the need to revise your business model. For example, due to the onset of the pandemic, many businesses had to revisit their business models to facilitate a transition to the online environment so that they could remain operational and profitable.
As a business owner, you will have to consider all of the variables that can occur and affect your business and create financial projections that reflect such. It is not feasible to cover every single ‘what-if’ scenario, however, we have listed a few below:
- What if your customer only shops online? – how will this affect the financial performance of your business?
- What if the Government closes the borders again due to other crises that can occur?
When you apply these scenarios to your business model, it shows lenders and investors that you are pliable and can adapt to your customers’ needs. As a business owner, you must be able to develop that business acumen and know-how and when to pivot according to evolving trends in the environment and market.
Want to learn more about why it’s time to remodel your business? Check out our video below:
This article is based on a discussion with Ashley Mitchell on the Straight off the BATT Live Series from the Bankers Association of Trinidad and Tobago. The show aims to help you understand financial literacy and education. Subscribe to our YouTube channel for more.