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Business Model Development

Business Model Development - Your Retail Coach

There might not be any stringent definition of what a business model is. But it constitutes the core ideology behind why and how a business will fare in a market in a given environment. The product or service alone is not a determining factor here. A business model showcases what is ‘value for customers and how that value can be created and delivered through a planned framework of capabilities. Generally, a business model contains strengths, weaknesses, opportunities and threats analysis, vision statement, mission statement, strategic plan, strategic planning process, competitive advantage, long tem goals, issue based solutions etc.

Technology has played a big role in the emergence of unique and disruptive business models as it can significantly affect what is ‘value for customers and how the value chain operates. For instance, Tunisian fintech startup Kaoun offers e-KYC, electronic signature, and online payment services to businesses, governments, and financial institutions. These services have tremendous potential in achieving macroeconomic goals like financial inclusion and distribution of public welfare services. RideSafe in Kenya is a blockchain-based application that offers real-time emergency response solutions to the public motorbike sector in the event of an accident.

It is not just what the product or service is but also how ‘value for customers’ is created and delivered that determines the fate of businesses.

Challenges in business model development and its upkeep

Once you have a good retail business idea, you must redirect yourself towards developing a Developing retail Business Model for the identified business opportunity and figuring out how you intend to create and deliver the value-based offering towards making your business idea possible and more profitable. Although there are various types of retail business models there are challenges which are undermined or not addressed appropriately. We have listed a few such challenges here.

Lack of innovation and adaptation

Keeping the business model relevant is essential to business sustainability. Changes in the environment could drastically reduce the effectiveness of your business model. If you fail to keep your business model relevant, sooner or later, your competitors will find a way to create and deliver value to customers more effectively and efficiently in tune with changing customer behaviour and expectations.

Resistance to change

Businesses tend to stick with what works for them. Whether it is a startup or a company at its prime, it can always appear difficult to choose change over maintaining the status quo. Steady operations, smooth flow of revenue with profitability, internal organisational power tussle, labour unions, investors, and for so many other reasons of all shades, our vision and business acumen may remain myopic and resistant to change for a sustainable future.

Dependence on a single channel

Online retail business models or eCommerce-based models are becoming extremely popular and favourable. What also cannot be denied is that brick and mortar dominates the elephant’s share in the retail sector of every country. So, a retail business model that does not consider an omnichannel or multichannel approach somewhere stands to lose out on a bigger customer base.

Lack of adequate technology

We can pick up as many successful retail business model examples and still find that the retail enterprise’s digital and technological framework is a decisive element of its retail Business Strategy Development model. Digital technologies significantly affect what is ‘value for customers’, how the value chain operates, and how that value is delivered. Tools like ERP, analytics, web and mobile applications, digital marketing, CRM, digital payment platforms, iWMS, etc. have become essential for managing both core and support operations of a business enterprise. Today, businesses, supply chains, and distribution networks operate more synchronously than ever before, giving rise to the need for all to be under one compatible digital ecosystem.

How YRC can in business model development services in africa

YRC’s retail Business Model Development aims at building the strategic framework of the value chain and internal capabilities enabling businesses to deliver the intended value-based offering to their target segments. We focus on bringing out the best UVP for your customers, formulating an effective omnichannel strategy, identifying the requisite business applications requirements, and addressing the operational aspects.

You cannot sell what people would not buy and what makes customers purchase something is strongly determined by the edge you provide over your competitors. This edge could be in the area of pricing, product features, customisation, personalisation, payment flexibility, service and support, return policy, etc. But you will have to bear in mind that UVP is something you should not be tinkering with. It forms an important part of your brand positioning and brand image. If you launch as a brand that gives free home delivery, and later you start charging for the same, your branding will take a hit. Your UVP is what separates you from the rest. If you take the uniqueness or the value out of your UVP, you would be putting your brand identity at stake. Also, what you state as your UVP should not be easily replicable. At YRC, we follow a planned and systematic process in UVP assessment and recommendations involving secondary market research, SWOT analysis, industry trends, customer behavioural patterns, customer and user experience journey, and a host of other elements through our retail Business Strategy Development services.

The emergence of O2O strategy is a stark reminder of how mammoth the brick and mortar retail market is. But it is also true that eCommerce is rising sharply especially among the younger generations. In such a situation, the omnichannel approach gives retailers access to a wider customer base. That also explains the increasing popularity of brick-and-click strategy, click-and-collect strategy, O2O strategy, etc. Even the customers benefit when they get a seamless shopping journey and experience with the integration of the physical and online channels. We will assess the effectiveness of both internal and external channels towards letting your business have the maximum market coverage through our retail Business Model Development services.

Because digital technologies have become an integral part of today’s new retail business models, identifying the requisite business applications has become equally important. Now, for instance, without the right digital marketing software, it might be difficult for you to figure out if your campaigns are making any constructive communication with your target audiences. Or say, if your business model requires the pizza to be delivered in 40 minutes, your order fulfilment and delivery application system must account for it. Our team of experts will help you identify the business software applications and system integration requirements towards ensuring that your business model functions at full throttle.

Whether it is an eCommerce or retail store business model, mapping and streamlining your business operations is critical to delivering the intended value-based offering with utmost precision. Extending the pizza delivery example, in the absence of the right SOPs, your delivery team will choose to carry a maximum number of pizzas because it will save their efforts of coming back to the restaurant multiple times. And if that happens, none of your customers is ever likely to get their order fulfilled in 40  minutes. So, defining these operational aspects is critical to consistently achieve the intended UVP. Maintaining the consistency and quality of service across stores and regions is even more important for retail chain business models. Our experienced SOP experts will address these operational aspects.

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So many new business models come and go but the ones that stay, usually stay for long. We are a boutique retail consulting firm. To know more about us and our services or if you have any query, drop us a message and we will get back to you.

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