When developing a business, having great, innovative ideas is not enough. You need a clear plan on how you can bring that idea to life. One of the most popular and practical tools for this is the Business Model Canvas (BMC), a visual framework that helps entrepreneurs and companies to map out their business on a single page.

So… What is Business Model Canvas?

The business model canvas was developed by Alexander Osterwalder in 2005. It is a one-page strategic management tool that helps you describe, design, challenge, and pivot your business model. This nine-blocks model serves as an alternative to the traditional long, complicated business plan. In this model, you can lay out the essential elements of your business in a simple, visual format.

The BMC is divided into nine key building blocks:

  1. Customer Segments – Who are your customers?
  2. Value Propositions – What values are you delivering to them?
  3. Channels – How will you reach them?
  4. Customer Relationships – How will you build and maintain relationships?
  5. Revenue Streams – How do you make money?
  6. Key Resources – What assets are essential to run the business?
  7. Key Activities – What must you do well to be able to deliver the values?
  8. Key Partnerships – Who will be helping you to succeed?
  9. Cost Structure – What are the costs you will be spending?

A Real-World Example: (GoFood by Gojek)

  1. Customer Segments: busy urban consumers, restaurants
  2. Value Proposition: convenient food delivery, increased restaurant sales
  3. Channels: mobile app
  4. Customer Relationships: ratings, reviews, promotions
  5. Revenue Streams: delivery fees, commission from restaurants
  6. Key Resources: delivery fleet, technology platform
  7. Key Activities: order processing and delivery
  8. Key Partnerships: restaurants, drivers
  9. Cost Structure: driver wage, platform maintenance, marketing

After mapping it out, GoFood will be able to understand better about their winning point, what needs to be improved, and how they can innovate.

In conclusion, the business model canvas is a versatile tool that can be used by anyone — startups or even by established companies. This model helps to test new ideas, improve existing models, or pivot business strategies. Whatever your goal is, BMC is you fast-track to clarity and action!

So, next time you have a big idea, instead of writing a long business plan, use a BMC template and start sketching!