business model workshop pack template

Copyright Pricing Insight 2014 1

BUSINESS

MODEL CANVAS

WORKSHOP

Copyright Pricing Insight 2014

AGENDA

BUSINESS MODEL WORKSHOP

BUSINESS MODEL CHANGE = ESSENTIAL FOR

SURVIVAL

3

DEATH OF A SALESMAN? 4

NEED A DIGITAL PLAN 5

WORKSHOP DESTRUCTIONS 6

KNOWLEDGE CHECK 7

BUSINESS MODEL CANVAS FOR APPLE 8

BUSINESS MODEL CANVAS - TEMPLATES 9

ADDITIONAL RESOURCES 12

VALUE PROPOSITIONS 13

VALUE MANAGEMENT SYSTEM 14

REVENUE & MARGIN PLANNING 15

HOW MUCH LESS CAN WE SELL?

ABOUT PRICING INSIGHT

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BUSINESS MODEL CHANGE = ESSENTIAL FOR SURVIVAL

Every business needs to evaluate the model of generating value. Timelines

between innovation, disruption and extinction are now more compressed.

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Timeline used to be decades between innovation, disruption and extinction. Now it is less than 5 years.


DEATH OF A SALESMAN?

Art Pearson began selling brushes and cleaning supplies for Fuller Brush

company when he was twenty. He stopped when he was 93. From 1938

through March 2011, Pearson went door-to-door selling detergents, mops,

and, of course, brushes in the Seattle area. He had collected over 4,000

contacts and sold hundreds of thousands of dollars in merchandise. He was

the oldest, and longest-serving “Fuller Brush Man” in the United States.

Pearson, who for the last three years was helped along his route by his son

Ken, had the same tried-and-true technique: Knock on the door, step back

two paces, hold a vegetable brush and a spatula, or maybe a pastry brush

and a comb. “Which free gift would you like? May I step in and give it to

you?” he’d say.

Fuller Brush Men once covered the country. The company, which started in

1906, once claimed to have knocked on the doors of 90% of homes in the

U.S. by the 1950s. Working for the company must be enjoyable since a

company spokesperson mentioned several men who had sold for Fuller for

60 and 65 years, still well below Mr. Pearson’s record of 73 years.

Lets use the time machine to predict what will happen.

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WHY HAS THE DOOR TO DOOR SALESMAN DISAPPEARED?ARE THERE ANY PARALLELS IN OUR BUSINESS?


Business Model Tip:

New Ways of Thinking

+

Need a Digital PlanEvery major disruption since 2000 can be traced to digital disruption.

Globalisation is almost solely as a result of the digital connectivity across borders.

Every industry needs a digital strategy to:

Accelerate information flows because customer want “on demand” everything

Improve accuracy because the margin for error is smaller

The profitability of transactions is contracting

Digital is a primary source of both cost reduction and value generation


WORKSHOP DESTRUCTIONS

Step1. Go to slideshare.net + YouTube.com

Step 2. Look up “business model generation” + “business model canvas”

Step 3. Go through 2-3 presentations to learn the basics of business model canvas

OK. Now What?

UNDERSTAND BUSINESS MODEL CONCEPT

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KNOWLEDGE CHECK

1. Understand the 9 key building blocks

2. Take a look at well known business models like Apple or Nespresso. Get familiar with the linkages and terms – just Google!

3. Map your business according to the 9 building blocks. Review any documents already circulated one more time.

THINGS TO DO BEFORE THE WORKSHOP

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BUSINESS MODEL CANVAS FOR APPLE

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BUSINESS

MODEL CANVAS

TEMPLATES

Key Partners

Who are our Key

Partners?

Who are our key

suppliers?

Which Key Resources

are we acquiring from

partners?

Which Key Activities do

partners perform?

MOTIVATIONS FOR

PARTNERSHIPS:

Optimization and

economy

Reduction of risk and

uncertainty

Acquisition of

particular resources

and activities

Key Activities

What Key Activities do our Value

Propositions require?

Our Distribution Channels?

Customer Relationships?

Revenue streams?

CATEGORIES

Production

Problem Solving

Platform/Network

Value Propositions

What value do we deliver

to the customer?

Which one of our

customer’s problems are

we helping to solve?

What bundles of products

and services are we

offering to each Customer

Segment?

Which customer needs are

we satisfying?

Customer Relationships

What type of relationship does

each of our Customer Segments

expect us to establish and

maintain with them?

EXAMPLES

Personal assistance

Dedicated Personal Assistance

Self-Service

Automated Services

Customer Segments

For whom are we

creating value?

Who are our most

important customers?

Mass Market

Niche Market

Segmented

Diversified

Multi-sided PlatformKey resourcesWhat Key Resources do our Value

propositions require?

TYPES OF RESOURCES

Physical

Intellectual (brand patents,

copyrights, data)

Human

Financial

Channels

Through which Channels do our

Customer Segments want to be

reached?

Direct Sales

Distributors

Web – online sales

Franchise partner

CostsWhat are the most important costs inherent in our business model?

Which Key Resources are most expensive?

Which Key Activities are most expensive?

IS YOUR BUSINESS MORE:

Cost Driven (leanest cost structure, low price value proposition, maximum

automation, extensive outsourcing)

Value Driven (focused on value creation, premium value proposition)

Fixed Costs (salaries, rents, utilities)

Variable costs

RevenuesFor what value are our customers really willing to pay?

For what do they currently pay?

How are they currently paying?

How would they prefer to pay?

How much does each Revenue Stream contribute to overall revenues?

BUSINESS MODEL CANVAS

Business Model Canvas Summary-Comparative

Current State Business Refinement Radical Transformation

VALUE

PROPOSITIONS

CUSTOMER

SEGMENTS

CUSTOMER

RELATIONSHIPS

CUSTOMER

CHANNELS

REVENUE

STREAMS

KEY ACTIVITIES

KEY RESOURCES

KEY PARTNERS

COST STRUCTURE


Additional

Resources


VALUE PROPOSITIONS

What value can we add to our customer’s buying experience?

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Risk Avoidance state

Trauma

Pain

Headache

Irritation

Neutral

Gain / Benefit State

Not negotiable

Critical

Focused

Interested

Neutral

What things are our customers are the areas for our customers that are in the top 3 gain states? What are the areas we help our customers avoid – Trauma, Pain, Headaches?

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VMS framework Value drivers Economic benefit

VALUE MANAGEMENT SYSTEM

What ways can we add value to our customers & charge for it?

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Value Management

System


REVENUE & MARGIN PLANNING

Where should we focus our efforts?

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0.00%

10.00%

20.00%

30.00%

40.00%

50.00%

60.00%

70.00%

$- $50,000 $100,000 $150,000 $200,000 $250,000 $300,000

Revenue vs Margin %

FOOLS GOLD

HIGH VOLTAGEEXPLORER

SOCKS

SWEAT SHOP


HOW MUCH LESS CAN WE SELL?

BREAK EVEN ANALYSIS

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EBIT Impact

0.25% 0.50% 0.75% 1.00% 1.25% 1.50% 1.75% 2.00% 2.25% 2.50% 2.75% 3.00%

0.00% 1,187,500 2,375,000 3,562,500 4,750,000 5,937,500 7,125,000 8,312,500 9,500,000 10,687,500 11,875,000 13,062,500 14,250,000

-1.00% 700,625 1,876,250 3,051,875 4,227,500 5,403,125 6,578,750 7,754,375 8,930,000 10,105,625 11,281,250 12,456,875 13,632,500

-2.00% 213,750 1,377,500 2,541,250 3,705,000 4,868,750 6,032,500 7,196,250 8,360,000 9,523,750 10,687,500 11,851,250 13,015,000

-3.00% 273,125- 878,750 2,030,625 3,182,500 4,334,375 5,486,250 6,638,125 7,790,000 8,941,875 10,093,750 11,245,625 12,397,500

-4.00% 760,000- 380,000 1,520,000 2,660,000 3,800,000 4,940,000 6,080,000 7,220,000 8,360,000 9,500,000 10,640,000 11,780,000

-5.00% 1,246,875- 118,750- 1,009,375 2,137,500 3,265,625 4,393,750 5,521,875 6,650,000 7,778,125 8,906,250 10,034,375 11,162,500

-6.00% 1,733,750- 617,500- 498,750 1,615,000 2,731,250 3,847,500 4,963,750 6,080,000 7,196,250 8,312,500 9,428,750 10,545,000

-7.00% 2,220,625- 1,116,250- 11,875- 1,092,500 2,196,875 3,301,250 4,405,625 5,510,000 6,614,375 7,718,750 8,823,125 9,927,500

-8.00% 2,707,500- 1,615,000- 522,500- 570,000 1,662,500 2,755,000 3,847,500 4,940,000 6,032,500 7,125,000 8,217,500 9,310,000

-9.00% 3,194,375- 2,113,750- 1,033,125- 47,500 1,128,125 2,208,750 3,289,375 4,370,000 5,450,625 6,531,250 7,611,875 8,692,500

-10.00% 3,681,250- 2,612,500- 1,543,750- 475,000- 593,750 1,662,500 2,731,250 3,800,000 4,868,750 5,937,500 7,006,250 8,075,000

-11.00% 4,168,125- 3,111,250- 2,054,375- 997,500- 59,375 1,116,250 2,173,125 3,230,000 4,286,875 5,343,750 6,400,625 7,457,500

-12.00% 4,655,000- 3,610,000- 2,565,000- 1,520,000- 475,000- 570,000 1,615,000 2,660,000 3,705,000 4,750,000 5,795,000 6,840,000

-13.00% 5,141,875- 4,108,750- 3,075,625- 2,042,500- 1,009,375- 23,750 1,056,875 2,090,000 3,123,125 4,156,250 5,189,375 6,222,500

-14.00% 5,628,750- 4,607,500- 3,586,250- 2,565,000- 1,543,750- 522,500- 498,750 1,520,000 2,541,250 3,562,500 4,583,750 5,605,000

-15.00% 6,115,625- 5,106,250- 4,096,875- 3,087,500- 2,078,125- 1,068,750- 59,375- 950,000 1,959,375 2,968,750 3,978,125 4,987,500

-16.00% 6,602,500- 5,605,000- 4,607,500- 3,610,000- 2,612,500- 1,615,000- 617,500- 380,000 1,377,500 2,375,000 3,372,500 4,370,000

-17.00% 7,089,375- 6,103,750- 5,118,125- 4,132,500- 3,146,875- 2,161,250- 1,175,625- 190,000- 795,625 1,781,250 2,766,875 3,752,500

-18.00% 7,576,250- 6,602,500- 5,628,750- 4,655,000- 3,681,250- 2,707,500- 1,733,750- 760,000- 213,750 1,187,500 2,161,250 3,135,000

-19.00% 8,063,125- 7,101,250- 6,139,375- 5,177,500- 4,215,625- 3,253,750- 2,291,875- 1,330,000- 368,125- 593,750 1,555,625 2,517,500

-20.00% 8,550,000- 7,600,000- 6,650,000- 5,700,000- 4,750,000- 3,800,000- 2,850,000- 1,900,000- 950,000- - 950,000 1,900,000

% price rise

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ABOUT PRICING INSIGHT

Pricing Insight

VALUE PROPOSITIONWe help companies accelerate

revenue and margin expansion

[Track record: $2.7M-$7.0M per project]

CLIENTSFortune 500, ASX 500, PE Portfolio

companies

REVENUES UNDER ADVICE$1.1B

Total lifetime: $5.0B

EXECUTIVES TRAINED2,300

FOUNDED2007

FOUNDER

RON WOOD

CASH GENERATEDApprox. $150MAverage yield 3.0%

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RON WOOD - AUTHOR, FOUNDER & DIRECTOR of

PRICING INSIGHT

WORK WITH AUSTRALIA’S LEADING PRICING ADVISOR11

• GENERATE MORE REVENUES

• DRIVE MARGIN EXPANSION

• PROTECT EXISTING BUSINESS

“I have been working with great companies for 20 years.

Pricing, revenue and margin strategy is the sum valuation of all the effort

and care taken by each employee to generate value. I am passionate

about ensuring that value is recognised, communicated and captured to

allow the organisation to continue to grow safely through each stage of

the business cycle and generate the right return on capital for

shareholders.

It is the reason I started the business”.

Ron Wood

Contact details::

E: [email protected]

SKYPE: ron_wood01

P: +61 2 8226 8621

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mailto:[email protected]


CLIENT PARTNER EVALUATIONS

Experience and commitment to achieving outcomes

“With so many actual case studies and Ron’s simple, practical approach, our team left

invigorated and empowered with the knowledge required to turn pricing into a

competitive advantage. The section on creating a Value Management Framework has

been the single biggest light bulb moment I have experienced in my career.”

Ryan McCarthy - Finance Director | Stryker South Pacific

"Working with Pricing Insight gave us the ability to truly discover the value in our offer.

It’s all too easy to assume the reasons your customers buy from you, or that your sales

teams are competent or confident enough to be able to articulate that value. Breaking

down and mapping our value drivers was the key to changing our focus on how we

delivered on our strategic pricing objectives. I would recommend Pricing Insight to any

Sales Director looking to better understand their sales operation".

Tim Hulme - Sales Director | DEVRO Australia New Zealand

“Our first experience with Pricing Insight was the participation in the MasterClass.

This one day session challenged our thinking and approach to pricing. Following the

MasterClass we implemented immediate change to our approach to pricing which

resulted in improved margins. Our entire sales force have now been through a mini

MasterClass and are now working through the customer value discovery process.”

Jamie Ramsey - Sales Director | Nover

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CONTACT DETAILS

We work with a wide range of product and service related industries to

generate earnings growth

Corporate Office: Level 26, #1 Bligh Street Sydney 2000

P: + 61 2 8226 8621

E: [email protected]

W: www.pricinginsight.com.au

Rank Group

Limited

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mailto:[email protected]

business model workshop pack template

Business

business model tip

survivalevery business

known business models

digital disruption

fuller brush company

door salesman

fuller brush men

digital strategy