ENTREPRENEURSHIP MARKET VALIDATION

WEEK VI

Business Model Canvas - Efficiency

(KR, KA, KP, CS)
 Learning Objectives

LO 3 : Use the business model canvas as a program to support

innovation
 Subtopics

• Business Model Canvas – Efficiency (KR, KA, KP, CS)

Student Activities
 Student Activities

• Student Present BMC (KR, KA, KP, CS)

• Lecturer Give Feedback
• Lecturers ensure that Bisanara can be started in Week 9, by already
listing 3 active social media about their business
https://binusianorg-
my.sharepoint.com/personal/gguzman_binus_edu/_layouts/15/guestac
cess.aspx?
docid=082be60b8f9f44e83bdd9497a7f310fc9&authkey=Ab1hQjWl
AMHcjRMpxP0bjrk&e=Lnp9mc
Business Model Canvas
 Business Model

A Business Model describes the rationale of how an

organization creates,delivers, and captures value.

A Business model canvas is a shared language for

describing, visualizing, assessing, and changing
business models
Business Model Canvas
9 Building Blocks
Business Model Canvas
 Key Resources (KR)

The key Resources building block describes the most important assets
required to make a business model work
 Key Resources’ Categorization

Physical Intellectual
• Building • Brands
• Vehicles • Knowledge
• Machines • Patents
• Systems • Copyrights

Finance
Finance
•• Cash
Cash
Human •• Loans
Loans
•• Stocks
Stocks
 Key Activities

The Key Activities building block describes the most important things a
company must do to make its business model work
 Key Partnerships

The Key Partnerships building block describes the

network of suppliers and partners that make
the business model work
 Types of Partnerships

Strategic alliances between non-competitors

Coopetition: strategic partnership between competitors

Joint venture to develop new business

Buyer-supplier relationships to assure reliable supplies

Motivation for Creating Partnerships

Optimization and
economy of scale

Reduction of risk and

uncertainty

Acquisition of
particular resources
and activities
 Cost Structure

The Cost Structure describes all cost incurred to operate

a business model
 Two Types of Business based on Cost
Structure

Cost-driven
• Focus on minimizing costs wherever possible.
• This approach aims at creating and maintaining the leanest possible Cost Structure,
using low price Value Propositions, maximum automation, and extensive
outsourcing.
• No frills airlines, such as Air Asia, Tiger Air, Citilink are some typify cost-driven
business models.

Value-driven
• Premium Value Propositions and a high degree of personalized service usually
characterize value-driven business models.
• Luxury hotels, with their lavish facilities and exclusive services, fall into this
category.
Cost Structure Characteristic

Fixed costs
• Costs that remain the same despite the volume of goods or
services produced.
• Examples include salaries, rents, and physical
manufacturing facilities.
• Some businesses, such as manufacturing companies, are
characterized by a high proportion of fixed costs.

Variable costs
• Costs that vary proportionally with the volume of
goods or services produced.
• Some businesses, such as music festivals, are
characterized by a high proportion of variable costs.
 Cost Structure Types

Economies of scale
• Cost advantages that a business enjoys as its output
expands.
• Larger companies, for instance, benefit from lower
bulk purchase rates. This and other factors cause
average cost per unit to fall as output rises.
Example:
A beverage company, buys bottles for 100 products for Rp. 1 million. Then the
costs incurred for 1 product is Rp. 10,000.

If the company buys 500 bottles, the cost that comes out is IDR 4 million.
Then the costs incurred for 1 product is Rp. 8,000.

The more companies buy bottles, the lower the cost for each bottle. This is
called Economies of Scale.
 Cost Structure Characteristic (2)

Economies of scope
• Cost advantages that a business enjoys due to a larger
scope of operations.
• In a large enterprise, for example, the same marketing
activities or Distribution Channels may support
multiple products.

Example:
Unilever sells a variety of products in stores spread throughout the world.
The total costs incurred will be reduced compared to small companies,
which only sell 1-2 products.
Apple iPod/iTunes Business Model
Next Session Preparation
 Next Session Preparation

a. Lecturer reminded to complete the video compilation Market validation to be presented in week 7. The
content of the video is experience offers directly to customers, Interest / uninterest customers, and
recommendations from customers.
b. The group showed a video of market validation complications with a compilation video duration of 2 – 3
minutes
c. and the group presented the video's caption for 2 minutes.
d. Student get feedback from Lecturer
e. Students understand product packaging tips by looking at the "Product Packaging Tips" ppt
• https://binusianorg-my.sharepoint.com/personal/gguzman_binus_edu/_layouts/15/guestaccess.aspx?
docid=0fb44c8dc441d45a5a8b608a9772d0b93&authkey=AQOWI41tOq5EriFJcwamiIg&e=117Hx96.
• https://www.youtube.com/watch?v=1boWT2ciK88
f. Students get information about the effectiveness of social media in business development
https://www.youtube.com/watch?v=IGf8odUMW8Y
g. Students are reminded by lecturers to collect BMC Redevelopment in week 7 in PPT (pdf)
h. Lecturers collect Ppt (Pdf) group data and BMC Redevelopment Ppt Link in one class to the link provided
by BEC. Link attached to Appendix 6.
i. The lecturer also made sure the link was filled in, and sent it to the BEC.
 References

Osterwalder, A., & Pigneur, Y. (2010). Business model generation: a

handbook for visionaries, game changers, and challengers. John Wiley
& Sons.