BUSINESS MODEL

 Business model describes the basis of how a business creates, delivers and captures value. Also how business
operates and work to provide the best value to your customers
 Value defined as the worth, importance, or usefulness of the product or service of your business.
 Components in identifying Business model
a. Customer (who will be your customers the reason why you are creating your product/service)
b. Value Proposition (what makes your product unique from the one in the market)-The reason why your
customers buy your product/service over your competitors.
c. Distribution Channel (how your product/service will reach your customers ex. physical store, online store or
direct selling)
d. Key Resources (things you need to operate and run your business ex. raw materials, facilities, equipment,
store locations)
e. Key activities (operation of your activities ex. buying fresh and organic fruits)
Once you have identified the composition of your business model, you may plot it, and then summarize it to come up with
your business model.

 There are many models that you may adopt for your business.
a. Bricks and clicks, a model by which a business integrates both offline (bricks) and online (clicks) presence.
Ex. company that sells online then let their customer pick up their purchased product at their physical store
b. Direct selling, selling products to customer directly by maintaining physical stores. Most small and startup
business follow this model.
c. Reselling, a model where a business makes something which is resold by other business either with or
without modifications which add value to the original product or service (in which called value-added
reseller model).
Ex. buys notebooks then resells them with more artistic and attractive covers
d. Franchising, the practice of using another firm’s successful business model in exchange for a royalty of
franchise fee

IMPLEMENTING SIMPLE BUSINESS

 To be able to function, all business ventures need targets to guide them on what direction they are aiming for.
These targets should be for:
a. Sales (the amount of money they want to generate from implementing their business ventures)
b. Budgets (the amount of money you are willing to spend on your business venture. You must set your budgets
in such a way that your sales exceed your expenses to guarantee your profits)
c. Profits (the lower the cash they invest in the business, the closer the sales becomes profits)
-from the profits will come the dividends (the portion of profits that the entrepreneur can use for his
personal expenses) retained earnings (will be used to finance the continuing business expenses in the
future)
d. Savings (the amount of cash the student will set aside from his future. It is different from profits as it includes
whatever savings he acquires from lessening his expenses)
 Setting up your business
Important aspects in setting up your business
a. Location
b. Business Registration
Process in registering business: must first be registered at Department of Trade and Industry (DTI) for single
proprietorship and at Securities and Exchange Commission (SEC) for partnership and corporation.
You must prepare at least 5 attractive and creative business names. You must be 18 years old. You must bring
government ID’s, You must pay necessary fees.
Second, acquire Baranggay clearance together with Mayor’s permit
c. People
d. Supplier
 Once you are done with setting your business, you must now Operate your business
 Sell the product or service
 Sustainability and evaluation