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Skip to 0 minutes and 9 seconds My name is Mark Watson. I run a company in Melbourne called Design Providence, but I’m internationally affiliated with a group called DesignThinkers Group. So design thinking fits a smaller canvas– I also teach into the MBA in one of the research subjects here trying to introduce design thinking methodologies to solve wicked problems. –more simplistic– The business model canvas is an interesting tool for small business in that it actually creates a visual reference instead of a textual document. It is a canvas and you can paint a picture of the business in one page simply and clearly. The benefits for small business, in using the business model canvas, is its simplicity and its clarity.

Skip to 0 minutes and 59 seconds It identifies the key areas within a business and gets you to focus on each of those. The difference between a standard business plan and a business model canvas is really the evolution of the development of it. There’s still room for a business plan, but the business model canvas is the rough sketch, the tool that you use to put down your rough ideas. And helps you visualise simplistically, clearly and then you can take that information forward to develop a fully fledged business plan. But with the start ups everyone’s got a lot of ideas in their head and it’s all unframed and the canvas helps you frame that.

Skip to 1 minute and 42 seconds The most important thing for starting up a small online business for me, is the customer. That’s a central focus these days. That’s where everyone’s looking for growth and those opportunities as niche opportunities to develop their business. So with a good understanding of your customer, really interrogating who your customer is and what their needs are, and really driving towards delivering a service that meets those needs. And the business model canvas helps you investigate getting towards a central value proposition. You are limited by your imagination only with the business model canvas. It is a very easy tool for anyone to use.

Business Model Canvas

When starting off, consider using a tool such as Strategyzer's Business Model Canvas to help identify and explore your business idea.

Think of the Business Model Canvas as a preliminary planning document that describes what you plan to do and how you plan to do it – it covers the who, what, why and how of the business.

The Business Model Canvas tells us the “how” by showing:

  • The key activities that need to be undertaken to start up, operate and grow the business
  • The network of key partnerships required to reduce risk and acquire the right resources for the business
  • The financial and physical resources required
  • The various customer segments and the customer relationships that the business intends to build with these segments
  • How the business’s products/services will meet customer needs and wants (the value proposition)
  • The distribution channels that will be used to deliver the products/services to customers
  • The ways in which the business intends to generate revenue - income from the sales of its products/services
  • The total costs to be incurred through the creating and operating of the business model (cost structure).

The Business Canvas Model addresses all of the above by allowing you to think innovatively about the right business model to deliver your new products or services in the online environment.

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This video is from the free online course:

Online Business: Planning for Success

RMIT University