fbpx

Which Business Model Will You Choose?

by | Sep 27, 2018 | NatHERS

There are many different types of business models out there. When you’re starting out, it’s important to choose the one that is best suited to your business concept. Here, we’ll introduce some of the main types of business model (hint: it’s not an exhaustive list!)

 First, what is a business model?

A business model is not focused on what you sell, but how your business creates, delivers, and captures value. In other words, we’re talking about how your business makes money from its operations. The best way to explain how a business model works is by looking at some examples.

 Here are 7 key types of business model:

 Manufacturer

A manufacturer takes raw materials and makes finished products. The manufacturer may then sell these products directly to the consumer or sell them to a middleman (such as a retailer or distributor) that sells to the consumer.

Franchise

Franchising is hugely popular in Australia. As at 2016, there were 1,160 Australian franchise systems and around 79,000 franchise units in Australia, representing 4% of our economy. With this business model, the franchise owner (franchisee) pays a fee in return for the right to offer, sell or distribute goods or services under a business system determined by the business founder (franchisor). The franchisor supports the franchised business group by providing leadership, guidance, training, marketing and a brand name in return for ongoing service fees. Anytime Fitness, Battery World and MacDonald’s are examples of successful franchise business models in Australia.

Nickel-and-dime

With this business model, the basic product or service is cost-sensitive and therefore priced as low as possible. For every other service that comes with it, an additional amount is charged. For example, Jetstar (or any budget airline for that matter), charges the lowest possible price for the flight then adds fees for luggage, seat selection, priority boarding, and so on.

 On Demand 

As consumers demand greater convenience, speed, and simplicity, a growing number of businesses are moving to an on-demand business model – where customers get immediate access to products and services by means of technology. Uber is an example of the on-demand business model in action – today it facilitates 15 million rides a daywithout owning a single cab. Read more about how to make money in the on-demand economy.

Direct Sales 

Of all the direct-selling businesses out there, Tupperware is probably the brand most people think of. Tupperware is a true direct sales model in that the products are not sold in stores – they can only be purchased through Tupperware’s website or through a Tupperware consultant. But does direct selling still work in the internet era? Yes – in fact, social media allows sellers to reach more people than ever.

 High Touch

Think of this as a “person-centric” model in which the relationship between the business employees and the customers have a major impact on sale and retention. Much like in your sustainable energy rating business it’s all about building trust and relationships. For example, professional services such as accounting firms and financial services are high-touch businesses, as are beauty salons.

 Low Touch

By contrast,a low-touch business requires minimal involvement or assistance from employees when selling a product or service. The customer will buy the product or service without placing much value on the individual selling. IKEA is a great example of this in action with its hugely successful self-service business model. Shoppers leave the showroom, pick up their flat-packed goods from the warehouse, put the boxes on trolleys, and bring them to the checkout themselves – no staff required.

 Final Thoughts

New business models are continuously being created to meet changing consumer needs and evolving technologies. Here’s the thing: you do not need to use any of the existing business models when setting up your business – you can innovate and design your own to suit your business. This is the idea put forward by Alexander Osterwalder in his book Business Model Generation.We’ll discuss this more in the coming weeks, so stay tuned!

Want to learn more about business models?This article introduces more examples of business models, this one talks about how business models can be used for disruption and this Hubspot article is a great introduction to business model innovation.

Recent Blog Posts Testimonials

“Working at my own pace online and the response time to emails and responses were always great”

Ekaterina Sidorova
Lend Lease

“I’m extremely impressed by The Cert IV in HEES delivered by Transformed. It is a fantastic, relevant, and interesting course with great content. The study materials and assistance have been exceptional. Thanks again to Transformed for their support”.

Matt Wade
Cert IV in HEES Student – April 2022.

“Thanks for your support over the years and I look forward to doing more courses at Transformed in the future”.

Gerard
Cert IV in HEES - March 2022

“The course is really well organised, your videos and zoom meetings were extremely helpful, the platform functions perfectly, your response time to queries and questions is always prompt and overall it is just been a wonderful experience”

Melanie
Cert IV in HEES student, July 2021.

“Phenomenal course to understand contract management in the best way possible. I am working as a Procurement Manager and never understood contract part completely but this course helped me to understand key points of contract management. Thanks to author for creating this wonderful course. ”

Nitin
Student - Introduction to Contract Management - August 2021

“…I originally enrolled in Transformed’s Diploma of Project Management on the basis of their flexibility. ..As I subsequently discovered, Transformed’s approach extends even further to include ‘one on one’ coaching sessions… and adjusting the training to fit in with the client..”

Michael Irwin
Austrade

“Easy to deal with”

Laura Lace

“Learning – I have now fine-tuned my existing skills”

Brian Peterson
Moreton Bay Regional Council

“My assessor was absolutely fantastic and I couldn’t have achieved this without her encouragement and guidance’.

Simone
Cert IV in Procurement & Contracting - March 2022

“I am so appreciative of you and Transformed for your flexibility and support- THANK YOU”

Louise Anderson
Cert IV in P & C student - May 2020

“The self-paced learning it allowed me to work whilst studying”

Haylea Edwards
Efficient Living

“I found the course easy to follow and navigate through. I would recommend this course to others”

Ekan
August 2018

“The excellent and prompt communication from my assessor”

Cert IV in NatHERS Assessment student

“Don has been a terrific teacher and very prompt with feedback throughout the whole diploma, which has been great!”

Anna
Diploma of PM

“I am very satisfy with the study”

Eric Lam

“Always good and prompt feedback from Michael”

John Logan
Draft Comps Services

“The most practical and well organised course I’ve been involved with, perfect for anyone with a demanding full time career and family commitments. My facilitator was extremely helpful and being part of the construction industry applied a very focused approach to the course content which assisted me in completing my studies, Would strongly and have already recommended Transformed to those looking to complete their Cert IV and Diploma in Building and Construction. Thanks for all your efforts and support.”

Aleks Petrovic
Cert IV and Diploma in Building and Construction Student

“Just wanted to say thanks for putting up with me and getting me over the line!! Which I know was a bit difficult with no background in the industry!! Thanks very much and I look forward to starting my business and conquering the world as an Energy Rater!”

Laura Lace

“Just wanted to say thank you so much for offering such a great course, I have really enjoyed studying my Certificate IV in Home Energy Efficiency and Sustainability with Transformed”.

Melanie
Cert IV in HEES student, July 2021

“I engaged Michael Young from Transformed to assess me for the Australian Institute of Project Management Certified Practicing Project Manager. I wanted to be certified as I wanted to verify that the skills and knowledge was in line with industry best-practice. At first it seemed a bit daunting, however, Michael made the process very easy, providing templates for references and self-assessment as well as providing a list of the project management documents I would need to provide as evidence. The assessment interview was very relaxed and more like a conversation than an assessment, which brought out the best experiences to evidence my capabilities. Because of Michael’s current government security clearance, we were able to look at specific of particular projects, rather me than having to spend a heap of time sanitising documents. Since the assessment, I have been successful in gaining a promotion..”

Mike McCarthy

“I want to thank you for providing that encouragement and feed back at appropriate times. You make me and I’m sure all students, feel special and like we are getting personal assistance, which I have received. I don’t know how you manage all that you do but you do it well. Thank you”

Darrell
Cert IV in NatHERS Assessment student

“I think everything worked very smoothly”

Susan Mariott
Quality Home Design and Drafting Service

“All round I’ve been really impressed with how professional everyone at Transformed has been”

Anna
Diploma of PM

“Ease of delivery, completing from work”

Simone
Qld Health

“I also want to take the opportunity to thank you for all your help during my studies. I think your training company is very professional and I would endorse you and Transformed to anyone looking to study distance learning”

Doug Madarovski
Archives