BU121 Lecture 1: BU121 Lecture 1
Document Summary
Describes the rationale of how an organization creates, delivers and captures value. Explanation of how a company intends to make money / the logic by which it sustains itself financially: reflects the strategic decisions and trade-offs that entrepreneurs make to earn a profit. For not-for-profit business, their model is how the business sustains itself financially. The idea becomes a model and framework for that business. A product cannot succeed if it is not charged enough to cover costs, or targeted at the wrong audience. Different companies can have similar offerings but different business models. Gillette example: both razors shave your skin, first razor generates recurring revenue from customers buying blades (less expensive, but reoccurring purchases, second razor generates revenue from a one-time purchase (more expensive, but up front) 3 ways to make money in water filtration example from dragons den: q water. Rents water filtration system for a monthly fee to restaurants targets restaurants, specifically a bar or pub.
