By Davies Zhai - Jetek Staff
Business Models
A business model is a firm’s plan or recipe for how it creates, delivers, and captures value for its stakeholders.
The proper time to develop a business model is following the feasibility analysis stage and prior to fleshing out the operational details of the company.
A firm’s business model is integral to its ability to succeed both in the short and long term.
Standard Business Models
The first category is standard business models.
Standard business models depict existing plans or recipes firms can use to determine how they will create, deliver, and capture value.
Standard Business Models and Representative Companies
Advertising Business Model: Google, Facebook
Auction Business Model: eBay, uBid
Bricks and Clicks Business Model: Apple, Barnes & Noble
Franchise Business Model: 24-Hour Fitness, Panera Bread
Freemium Business Model: Dropbox, Evernote
Low-Cost Business Model: Southwest Airlines, Warby Parker
Manufacturer/Retailer Business Model: Apple, Fitbit
Peer-to-Peer Business Model: Airbnb, Uber
Razor and Blades Business Model: Game Consoles and Games, Printers and Ink Cartridges
Subscription Business Model: Birchbox, Blue Apron, Netflix
Traditional Retailer Business Model: Whole Foods Markets, Zappos
General Categories of Business Models
Disruptive Business Models
Disruptive business models, which are rare, are ones that do not fit the profile of a standard business model.
They are impactful enough that they disrupt or change the way business is conducted in an industry or an important niche within an industry.
Business Model and Representative Companies
Online Text Ads on Search Engines: Yahoo, Google
Software as a Service: Salesforce.com
Cloud-based Service to Connect Riders and People Willing to Provide Rides: Uber, Lyft.
