Business model assesment is a good “reality check” for the team. In this page you’ll find ideas and business model assesment guidelines. Familiarize yourselves to these instructions when it’s time to assess the business models for your fellow NY Start Up -companies. In the presentation below you’ll find good examples on different business models (slides 21-27) and we have analyzed the Kelly’s Lemonade Stand -business model as an example. (slide 23 in presentation).
Examples and more information about the business model assesment
Evaluation by business model box
Kelly’s Lemonade Stand -business model asssement example
Usually its worthwhile to open the words presented in the Business Model Canvas (BMC) Boxes and explain how the product answers to most important questions. This helps the assesment team to follow your thinking and reasoning behind the model. You can use the questions below as guideline (depending the idea all questions may not be relevant and some of the might be self-explationary)
1) Is the Value proposition real, easily communicated to customers and trustworthy ? Does it bring benefit to customer and does the customer understand it?
- Clarification behind the model: Cold juice is a clear product and consumers know it. It has need in the right conditions and it’s easily produced and quality control process is tested.
- Assesment: Clear explination. No real competitive advantage to competitors (at least not presented)
2) Is the target group clearly defined? How big the target market and what kind of market share can be obtained?
- Clarification behind the model: Target group is fairly clear (due to local storefront.) Product (cold juice) is a seasonal product that reaches all the passers by -persons in the park. There is about 1000 visitors/day, so there is potential in the summer.
- Assesment:Clear target group. How can you pilot the idea during the NY Start Up -programme, since the programme end’s in spring? Could you test your idea in other locations, like shopping centers or events? Are there others lemonade stands in the park or close by your planned location?
3) Can you reach the clients with your distribution channels/Do you have easy access to channel and can you expand/scale up the business model?
- Clarification behind the model: Vending place in the park, will certainly reach the visitors of the park. Online-presence can support the sales with imago-marketing and various events that are connected to the kiosk. Expansion requires investments to good and personnel, so scaling up is not that easy.
- Assesment: Park visitors are clearly easy to reach, but to create a stable customer base looks difficult and requires hefty emphasis on marketing and branding + events or similar things. As expansion is fairly expensive have you thought about opportunities for cooperation with other established businesses that could expand their offerings.
4) What is your relation to customers.
- Yrityksen tarkennus: Kaikki palvelu on henkilökohtaista ja verkkokauppaa ei ideasta johtuen voi toteuttaa. Teemme imagomarkkinointia sosiaalisen median (Facebook & Instagram) kautta.
- Clarification behind the model: All service is personal and online-sales are not an option. We do create some brand marketing to social media. (FB and Instagram)
- Assesment: Ok. Good
5) What are the companys Revenue Streams?
- Clarification behind the model: Sales and tips
- Assesment: OK. Some stores sell gift cards and discount passes. Have you thought about those?
6) What is your cost structure?
- Clarification behind the model: Raw-materials, advertisement, rent and salaries
- Assesment: Ok. Have you thought about product placement as revenue stream (cups and merchandise can be branded to your raw-material producing companies and you can get discount on purchases.
7) Who are your Key partners
- Yrityksen tarkennus: Saimme kioskilta toimiluvan kunnalta, joka myös ylläpitää puistoa. Pitämällä hyvää huolta kioskista ja lähiympäristöstä varmistamme, että toiminta saa jatkua myös tulevaisuudessa.
- Arviointi: Kuntakumppanuus ok ja ilmeisesti vaihtoehtoja ei ole tarjolla. Oletteko pohtineet laajempaa yhteistyöverkostoa, joka voisi tuoda myös kävijöitä? Miten voiko kuntaa hyödyntää jotenkin markkinoinnissa.
- Clarification behind the model: We received the operation permit from the community that’s also maintaining the park. If we take good care of the kiosk and surrounding areas we are confident that we can easily renew our permit.
- Assesment: Partnerhisp ok and looks like there are no options. Is there any other network you could leverage on marketing?
8) What are your Key resources
- Yrityksen tarkennus: Tuotteet, ihmiset ja raaka-aineet. Pyrimme hankkimaan raaka-aineet luotettavista lähteistä ja varmistamme, että kaikki tuotantovälineet täyttävät myynnin vaatimukset.
- Arviointi: Raaka-aineet ok. Voisivatko raaka-aineet tuoda jotain erottuvuutta muista kioskeista, esim lähituotanto, luomu, jne? Miten työntekijöiden asiakaspalveluosaaminen ja halu on varmistettu. Koska asiakassuhde on hyvin persoonallinen, on työntekijän toiminnalla ja palvelualttiudella tärkeä rooli yrityksen menestymisessä.
- Clarification behind the model:Products and people. We strive to purchase raw materials from reliable sources and make sure that all the factors of production comply with health and safety regulations.
- Assesment: Ok. Is there any differentiation options considering the raw-materials? Like organic/local production or such? How do you make sure your staff is motivated and always smiling to customers?
9) What are the Key activities to get the business up and running?
- Clarification behind the model: We have the permit from the community and necessary permits. We produce the juice by hand press, so you juice is fresh. We need to get all the equipment ready and create a marketing and online presence + social media accounts to selected services (Facebook & Insta)
- Assesment: Production is clear, but do you have a quality control for the raw-material quality? Can you create a co-marketing with the events that are happening in the park? Discounts for event participants etc.
Business model and idea are clear and most challenges lie in the marketing and weather “risk” Can you find a way to decrease the weather risk when there are not many people in the park?
We wish you success for BMC evaluation process.