Getting to Know the Elements of a Business Model Canvas

The Business Model Canvas (BMC) is a well-known framework used by many entrepreneurs. It functions as a tool to define the business model of a startup. Below is an explanation of the BMC.

What Is a Business Model Canvas?

The BMC is a strategic management tool presented in the form of a visual chart, consisting of nine core elements. This business model was first introduced by Alexander Osterwalder.

Osterwalder authored the book Business Model Generation, where he outlined a simple framework to present the key components of a business model.

At a glance, the structure of the BMC may seem simple. Broadly speaking, the flow of this strategy moves logically from one element to the next.

Customer Segments

The first element in the Business Model Canvas is identifying which customer segments your business is targeting.

For example, an airline might offer two different products to meet the needs of two distinct customer segments. Similarly, two television stations might air different shows for different audience segments.

This block contains all the key details about your customers. Within the customer segments section, you must be able to define:Customer Jobs, Customer Gains, Customer Pains

Value Proposition

The second element in the BMC is the value proposition, which makes your product or service stand out. These are the benefits your business promises to deliver to each customer segment.

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This is your chance to outline your strengths and advantages: What sets your business apart from the competition? Before launching your business, you must understand who your target audience is and how your offering can meet their needs.

Channels

Channels refer to the various platforms or means you use to deliver your product or service to your customers.

These could include physical stores, websites, social media, delivery services, or any combination thereof. By using the right channels, you effectively communicate your value propositions to your target segments, making this one of the most essential elements of the BMC.

Revenue Streams

Revenue streams are the sources from which your organization earns income from its customers.

This element is critical and must be managed optimally to maximise business revenue. It includes every way money flows into your business. Avoid waste, whether it’s materials, products, or workforce potential, by ensuring all elements contribute to your revenue.

Key Resources

Key resources are the assets necessary to deliver your value proposition, serve customers, and support your business processes.

This includes managing raw materials, controlling inventory, organising human resources, and overseeing daily operations. You must clearly outline the assets your business needs to run smoothly and support growth.

Customer Relationships

This element describes how you build and maintain relationships with your customers.

Understanding your customer types is essential, as each segment may require different approaches. You must know how to win customer loyalty and ensure consistent engagement, especially in a competitive market where customers may leave due to poor service or lack of connection.

Building a Business Plan with the Business Model Canvas

Today, many startups are being launched, often led by millennial founders or CEOs. If your business is a startup, the Business Model Canvas is one of the most widely used tools for crafting a business plan.

To create a BMC-based business plan, you need to complete all 9 blocks. Doing so will help you build a clearer, more structured strategy for your company. It enables you to plan ahead more effectively and minimise the risk of failure, supporting sustainable business growth.

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