More than halfway there! We’ve covered the first 2 steps in creating your business model, so don’t forget to keep them in mind! In case you’re just getting on board, be sure to get up to speed with Step 1:Core Strategy and Step 2:Strategic Resources. In this 3rd installment I’ll be covering Step 3 to your Business Model: Partnership Network, which will help you get one step closer to building your business.
Every business has a product or service of some sort. Whether you are a manufacturer, distributor, wholesaler, or even entrepreneur, supplies are needed to create or be apart of a bigger product. Take us here at Near Me for example. We provide services to help create your beautiful online marketplace to connect buyers and sellers with an all-in-one platform. While we don’t have a physical product, we are software as a service (Saas) that helps entrepreneurs and enterprise clients to have the platform to run their marketplace. With Near Me being the technical suppliers, a company such as Froggler or Stokeshare are able to provide their services to its clients.
Whether you are a well-established or young entrepreneur just getting their feet wet, be sure to have a very reliable supplier. The last thing you want is for your supplier to not be able to deliver and disrupt your whole marketplace. Meet with multiple suppliers in order to see which has the best fit for your business model.
Do you have any key partners who are in the business along with you? Whether it is a general partnership, limited partnership (LP), or even limited liability partnership (LLP). It is very common to establish partnerships with other entrepreneurs who may not have all the skills or even funds to get the marketplace started. Don’t be afraid to seek help or funding from more established firms to get on the right track. However, be aware when creating a partnership and be sure to document the guidelines between both parties involved, just in case things get ugly down the road.
I mentioned Airbnb in my article last week; they are a great example of a general partnership. It was co-founded by Joe Gebbia, Brian Chesky, and Nathan Blecharczyk who have all worked together to with their different strengths and expertise in order to continue the growth of the company. In keeping the company's best interest in mind, they’ve grown to establish in more than 34,000 cities and over 191 countries. That is pretty impressive and really shows the strength of its leaders.
Other key relationships
There are also other relationships that are quite popular, such as joint ventures, networks, and strategic alliances. For example, Barnes & Nobles and Starbucks. They are both two different companies who agreed in 1993 to provide an in-house coffee service within each bookstore. It was a perfect blend (no pun intended) as customers could read their books, relax, and enjoy a nice hot cup of coffee. Their strategic alliance formed to be one of the most successful. Joining forces does not necessarily mean your business can handle its own but simply gathering to create something even bigger and better.Sometimes entrepreneurs can be very stubborn when it comes to their business and when reaching out for partnerships. Being open to change can be the difference between being one of the most successful marketplaces or one that drops to the bottom. Now that we have covered our step 3 to your business model, stay tuned for next week of the last installment, where I will introduce Step 4, Customer Interface.