Nine Business Models For New Businesses To Follow

Business models adjust all the time to reflect the ever-changing markets. With technology at the forefront of daily life, many new models cater to those customers shopping on their computer or personal devices. Finding the right one that will fit with your new company can be a challenge. However, you can explore your options to find the one that best fits the organization you want to open. Here are a few models to consider as you write your business plan.

Virtual Goods

Every smartphone on the market has a store on it that allows the user to download apps for their entertainment, to assist them with daily chores, to lead them in exercises, or to make their life easier. Within many of the apps, especially games, you can use your device to buy items to help you do better at the puzzles assigned within it or to help you win the contest altogether. Some apps let you spend money on others and send them digital gifts. These virtual goods are intangible purchases that can make a business a great deal of money. Since there are very few expenses to design and release these virtual products into your programs, you can anticipate a large profit when you offer them. If your company intends to have applications for your customer to use, consider if you can utilize virtual goods as you design them.

Marketplace

Opening a marketplace allows those who have a service or product they want to sell to match up with those looking for it. Using the internet, you would develop a site that can be found by the public then offer to allow companies or individuals in that market to display what they have. Once you market your site, consumers can find what they are looking for and reserve or purchase it. Being the middleman between the two parties, you can ask for a small percentage of the sale in exchange for the space utilized on your website. This business model can be found currently in lodging, stock photos, and car services. There is very little expense on your part to open this business and operate it, especially if you are experienced in website design. If you choose this model, deploy security such as single sign-on systems that use a standard SAML assertion to authenticate users. Also, develop an interview process for your sellers to ensure that they are honest and that your buyers have the best possible experience working with your site.

Updated Direct Sales

You are familiar with direct sales companies, who have their sales people host parties and offer their products in the customer’s home to a large gathering that the client has invited. Many corporations like these have taken to the internet and now have their contract sales staff reach out to potential customers by social media instead of face to face. They hold parties on one of these platforms by creating an event for the sponsor to invite others to. The salesperson can also create a website to offer their products on instead of utilizing social media, giving anyone searching for that product to purchase it directly from the site. This takes away the pressure of having a party, yet allows the person who set up the page to continue to contact them for more business. If you intend to offer your products in a direct sales model, you might encourage your contract sales employees to market themselves virtually instead of in person.

Working Between the Manufacturer and the Consumer

If you wish to work with an inventory and people directly instead of virtually and you have experience and knowledge with a certain type of product, you might consider working between the manufacturer of that item and the public. While your overhead might be greater than the other business models as you get started and purchase your stock to have onhand, you will be able to negotiate cheaper wholesale prices from the source you are getting it from. This will let you pass the discount on to your own customers searching for that item. You can set up a storefront to work from or you can set up your business on the internet to reach a wider audience. Keep in mind that if you do create a website, you will need to add shipping to each sale you make. This additional cost should be factored into the price you calculate for each product.

Subscription

This business model is popular in this day and age and can be found in every market. In choosing this option, you will commit to offering products or services to your customers on a renewal basis. The client will agree to this arrangement and provide you with a credit card to be charged when your item is ready. This can happen on a monthly basis or every time a shipment is sent to them. When they wish to end the subscription, they will contact you and request that it be concluded. You can find this virtually in streaming services or in physical items that arrive on their doorstep. Customers appreciate this process because they can add this expense every month into the money they have to spend and know that it will be there with little effort on their part. For your company, you can expect a consistent income every month for what you have to offer, giving you the opportunity to plan what you have to order knowing that you will be able to pay for it when the invoice arrives.

Custom Products

The development of technology today allows you to produce one product at a time with minimal cost. While your overhead costs might be higher than other business models, customers will be willing to pay the higher price to have an item that is personal to just them. This will let them showcase their unique preferences or style to others. If your business is able to manufacture items one at a time or print a custom message on an article of clothing or household item, this could be a model to consider. If you have skill with a 3D printer, this would also be the business model that you might want to go with. If you choose this route, be sure to have forms developed to record the exact specifications the client wants before you proceed. Producing a product over because of error can be costly. Consider building a website to conduct your business through so that the customer can input exactly what they want with little error on your part.

Free With a Premium Option

Another option that streaming services are using is to offer an account to potential clients for free. However, to get certain perks, such as access to popular programs or the option to listen to music with few commercials, a premium account must be purchased. Customers appreciate having the ability to use the site for whatever purpose they need and be able to utilize it for free. This loyalty might entice them to invest in the premium level as well. Depending on the business you have started, this model might work well for you. It brings interested clients to your free service and builds the relationship with them. If you do determine to use this, consider making the options included in the paid for level something that your customers find valuable and relatable to your site. It should be a service they feel they must have and are willing to buy to make their daily schedule easier.

Social Experience

Potential clients want to know the people they are working with when they commit to purchasing from a company. You, as the business owner, can earn their trust, and therefore their business, by reaching out to them as a person instead of a CEO. Offer to write blogs for other members of your industry and add your own thoughts to your website. Post as yourself on your social media sites and encourage others in your management staff to do the same. Take photos of your employees at work or having fun and share them with the public. Being open and honest with customers considering your company will make them feel comfortable associating with you if they believe you share the same ideals as them.

Platform Models

In the arena of social experience, if your strength is in technology and web building, you have the option of starting your own platform for others to connect on. Like the premium option model, you would most likely allow your users to sign up for free. However, you can offer advertising to outside corporations that might relate to those conversing on your site. This model would cost little for you to operate yet bring in a large amount of profit in marketing revenue if you can gather enough followers to use it. You must, however, be available to maintain the platform around the clock. If those who use it find it difficult or inoperable, they may choose to socialize on a different site. Finding the right business model to fit your new company can be a challenge. Studying the ones that are prominent in the market today and adapting it to your organization can help you get off on the right foot.

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