Canvas model: what is it and how to apply it to your business?
El canvas model It is a resource for companies in the project or already established to analyze their business model and detect its pros and cons. Know what it is and how to apply it to your business with Hispanic Entrepreneurs.
What is the canvas business model?
It is also known as canvas methodology or business model canvas. It is a tool that allows you to develop new business models or evaluate those that already exist.
It is based on a management template that includes all the basic aspects of the business related to the company's infrastructure, value proposition, viability and customers.
It is a visual resource that allows an analysis to be kept simple and participatory. In addition, it is characterized by being dynamic; that is, it can change over time, thinking that businesses must evolve to adapt to the market.
The model consists of nine categories that analyze both the external and internal parts of the company. You can find models of online canvas templates to start applying it in your business.
All the characteristics of the canvas model they are summarized as follows:
- It is easy to use and fill in each of the categories that compose it. As well as easy to interpret.
- It facilitates teamwork, since it can - and should - be done with the participation of several people.
- It has a dynamic structure, which allows changes to the business model as time goes by.
- Each of the blocks is interconnected with the others, so you can see the influence they have on each other and have an overview.
How to apply the canvas model in your business?
To apply this model in a business, it is necessary to know what its components are and what information to add to each one.
The canvas methodology is presented as a template in which we are going to find nine blocks. Each of these refers to an element of the business that will help shape the project. It can also be applied to other companies to get to know the competition better.
The components of the model are as follows:
- Customer segments. Indicate what the market niche is. Here, the customer group (s) targeted by the brand are defined.
- Relationships with customers. You will define how the interaction with customers will be. Analyze the needs of each segment and analyze what you will do to attract and retain them.
- Sales and communication channels. It refers to the distribution channels of the product, as well as the way in which you will make contact with customers.
- Value proposal. At this point you define what will be the competitive advantage of your company. That is, why the customer will prefer your products instead of what the competition offers.
- Sources of income. Your business needs to generate income and in this block you indicate how it is going to do it. It can be for the sale of products, subscription, etc. In addition, you must determine how much consumers are willing to pay for your products.
- Key activities. It refers to all the actions that you must take to materialize the value proposition.
- Key resources. They are all the elements that are needed to start the business. This includes material, intellectual, financial and human resources.
- Associations. In this segment you list the alliances that are required to carry out the business model.
- Cost structure. Specify the main costs related to each part of the process. This will help you determine if the business is profitable and how much you need to sell to make a profit.
Start filling in the template
To apply the canvas business model you must gather a work team to begin discussing each element that we mentioned before. What is recommended is to print the template in a considerable size and place it in view of everyone.
First fill in the blocks that refer to external aspects of the company. These are the customer segments, relationship, channels, sources of income and value proposition. Then they complete the others that are related to the internal aspects.
As they work they can remove or add the elements that are necessary. They must analyze how the items in a block are related to others. For example, if you have multiple customer segments, make sure you have a value proposition for each one.
When you finish filling out the template, review it and leave it in view so that they can analyze it as time goes by.
What is the canvas model for?
Thanks to this model you can identify which are the essential elements of your business and what you should focus on to achieve the objectives.
Among the main benefits of the canvas model This allows you to have an overview of the business model, while giving you the opportunity to consider other alternatives. Also, from this you can prepare the business plan, thanks to all the information you can get.
Use the canvas model not only to know your company, but to evaluate the competition.