The steps from employee to entrepreneur do not happen overnight. When you decide you want to be your own boss and work for yourself it is important to do some research.
- Research the sort of business you are looking at starting.
- Research the business model.
- Research what is required for the business you choose.
- Research the key requirements for the business, will it suit your life?
Before deciding on which business model to choose what is the definition of a business model?
The definition of a business model is the way in which a business creates, organizes and delivers products or services to customers in order to make a profit. Entrepreneurs are in business to make a profit and in many cases to change their life. Entrepreneurs choose self-employment to work around children, travel, to create time freedom to do what they would like to do. With some business models, time freedom and the ability to change your life is greater, therefore consider your options when you choose which business model is the correct fit for your business and business strategy.
Carsten and I have had many businesses over the years. Some have been a success, others we have learnt from. The reason first commenced self-employment was to be there for the children when they were young. I wanted to be work around school hours close to home.
Key questions to ask is what pain points are you answering for your customers with your business and how is the value provided?
For a brief period when Carsten worked the second business around his first business. The second business provided a service to repair iPhones. The pain point for the customer was the iPhone was broken. Carsten provided a service as a small business owner repairing iPhones.
Carsten and I had a goal to be self-employed and be there for the children and our youngest is now in his last year of school. Working around school hours is possible when you choose the right business model. Having businesses and working from home, has enabled Carsten and me to be there for our children. Sometimes we were both working from home, other times one of us has been employed and the other self-employed. The goal to be self-employed and be there for the children has been possible because of the business models we chose at the time.
There are many basic business models for an entrepreneur.
The main thing is to start with one. Which business model to choose?
will be your choice. Let’s look at some traditional business models.
Traditional Business Model
Direct sales – Direct sales is when businesses sell products or service like a hairdresser, plumber who offer a service.
Franchising is one of the first businesses I brought. I bought a cleaning franchise on the Central Coast which I operated for 5 years. I learnt many skills in this franchise including the importance of scaling and leveraging services. A skill I use today, however now in an online business.
A freelancer fits into the traditional business model. As a freelance, you use your skills to help others build their businesses. Common freelance skills include web development, photography, business consulting.
A Reseller Model.
A reseller is a business owner who buys a product or service and then sells it at a profit. Often a reseller does not produce nor store the product they are selling. A reseller profits from the price difference between what they pay and the sale price.
The Affiliate Marketer Model.
Affiliate marketers are similar to resellers. Affiliate marketers find a product to market which they align with and market the product or service by the provision of value. Affiliate marketers are sometimes known as ‘value-added resellers’. The advantage of this model is little overheads, no stock and you can earn as you learn.
The Broker Model.
The broker model is where the broker/ business owner, employees of the broker brings buyers and sellers together. A good example of an online broker model is PayPal.
The Marketplace Model.
When your business is structured under the marketplace model you bring supply and demand together. The advantages of bringing supply and demand together are there are little overheads and no stock. An online example of the marketplace model is Airbnb.
Amazon too is a marketplace model where sellers and buyers are brought together. The marketplace model charges a commission fee or referral fee.
The Aggregator Model.
Similar to the online marketplace model the aggregator is an online model that uses a popular sector to promote and provide their services under with sellers providing goods or service. A popular example here is Uber. Uber is built on the aggregator model. It uses the taxi sector. Drivers for Uber, drive under the brand Uber not under their name. This is the key difference between the marketplace model and the aggregator model. In the marketplace model, sellers sell under their name on the brands’ platform.
The Subscription and The Freemium Model.
The subscription model has a few models within it. The main point about a subscription model is a person subscribes to the service, pays a fee and receives the value. An example here is Netflix.
There are many online subscription models too where communities are built and then subscription fees are charged for the content. Many of the online subscription models also have a freemium model. The difference between the subscription and the freemium model is the freemium model is when a service is provided free at the basic level. The greater value is provided to subscribers who pay a higher subscription. With the freemium model, it is important to have the balance correct as to what is given away and what is free so that subscriber do upgrade to the higher levels.
LinkedIn and YouTube are examples of freemium model businesses.
Through Lifestyle Anytime I promote as an affiliate marketer using the affiliate marketing model. The product I promote is an education system that teaches digital skills for affiliate marketing, marketing your small business, e-commerce and other streams of income. For years Carsten and I have chosen where we live and how we live, which is why we have started and closed a few businesses. We choose businesses that suited our lives at that time. Learning digital marketing is no different. This business is teaching us skills to free up our time and will allow us to travel more. Since starting my education with SFM I have learnt many skills. One of these skills is growing a YouTube channel, a freemium model where free tips and tricks are shared. Check out Carsten’s YouTube Channel. On Carsten’s YouTube channel ‘ARCHICAD Speed Modelling ‘ Carsten shares his tips and tricks as tutorials.
When deciding on a business the main thing is to start with one. Which business model to choose, you decide what suits your life.
Have a great day.
Contact: Angie at Lifestyle Anytime
About: Angie Emde
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