Business Model Canvas: the 9-step business plan

What is the Business Model Canvas?

The Business Model Canvas (BMC) is a handy tool that helps you map out your business in 9 steps or building blocks. In a single overview, you can see who your customers are, what you offer, how you earn money, and who you work with. This allows you to see how all these things are connected and respond better and faster to changes in your market.

How do I fill in the Business Model Canvas?

The 9 building blocks are often depicted on a large fill-in sheet. You can download a template or use a whiteboard or large sheet of paper. Fill in the model while brainstorming. You can do this alone, but it is better to do it with others. You will often come up with more ideas and insights with colleagues or other entrepreneurs.

These are the 9 building blocks of the Business Model Canvas:

1. Customer segments: who is your customer?

This section describes different groups of customers that you want to reach with your company. These people or organisations are the core of every company. It is difficult to survive without customers. Make a conscious decision about the customer groups you want to target, and the ones you don’t. Each customer group has its own wishes. Try to get a clear picture of these wishes. Adjust your product or service accordingly.

2. Value propositions: why do customers choose you?

A value proposition is the reason why customers choose your business. Why does a customer choose you? Is it the good service, the unique offer, the convenience, the price, the quality? If you know this, you can better convince customers.

3. Channels: how do customers find your company?

Channels play an important role in how a customer experiences your company. You have communication, distribution, and sales channels. Each channel has a different function, for example:

• increasing awareness about your product or service 
• offering service after purchasing your product
• gathering feedback from customers on your company 

4. Customer relations: how do you contact customers?

Choose how you want to interact with your customer. This can differ per customer group and  depends on your goal. Do you want to bring in new customers or keep existing customers? Are you aiming for faster delivery times or a better customer rating? The choices you make here determine the impression you leave on your customer. A good customer experience ensures that customers return and recommend your business to others.

5. Income flows: who will pay you for what?

In this step, you write down how much turnover or how many customers you need to make a profit. There are many ways to earn money with your business. These are called revenue models. For example, you can sell individual products or subscriptions, rent something out or get paid for services or advertising. Research which revenue model suits you and your customers.

6. Key resources: what do you need to move forward?

Key resources are the tools and resources you need to make your business model work. These resources ensure that you reach your market, nurture relationships with your customers and make money. Resources can be physical (such as equipment), intellectual property, financial, or human (the knowledge and skills of your employees). The key resources you need depend on your business. For an online shop, you need a smoothly functioning website. For a delivery service, you need a reliable vehicle.

7. Core activities: what will your company do?

This is about your most important business activities. You need them to make money, to maintain your customer relationships and to reach your markets. The most important question is: what exactly are we going to do as a company to ensure that our business model works? And what will we not do? Some activities are best done yourself. Others are better outsourced. 

8. Key partners: who do you work with?

For this block, you think about who you want or need to collaborate with. Your partners. With the right partners you will reach your goal faster. For example, grow your company and be more successful in the markets in which you operate. Get to know your (potential) partners well to ensure a successful collaboration.

9. Cost structure: what does it look like financially?

Starting and running a business costs money. Identify your financial needs. Define your key resources, core activities, and key partners clearly. Then calculate your costs. What are your highest costs, where can you cut costs, and how can you achieve economies of scale?

Done, what now?

Once you have gone through all the steps of the Business Model Canvas, you will have a good idea of where you stand with your business. With that information, you can make well-founded and goal-oriented choices. You did not create this plan to just leave in a desk drawer. Translate it into concrete actions Check your completed Business Canvas Model regularly to see how you can continue to develop your business.