STUDENT 1: Jason
A business model is important because it pretty much sets the tone on how the business in its entirety will operate. The business model is the frame that the business will be built around. After the framework is laid down then it with give the direction that the company is expected to head toward on a step by step basis. Without the business model companies wouldn’t know what direction to go in. they would be all over the place and this provides structure and direction.
Business models are influenced heavily by the internal and external factors. The external factors are more of the customer needs and the internal would be those who are providing that product or service to the customer. In the reading an example is given of Mc. Donald’s. Mc. Donald’s are all over the world and each Mc. Donald’s is tailored to fit the needs and wants of the people in that particular country. For example the Mc Donald’s in Mexico provides their customers with hot sauce and they also put a spice in their meats because that is what the people in Mexico have a preference for. Here in the United States hot sauce and certain spices in the meat aren’t provided because of the culture of the people in the United States and it not being a preference.
From my interpretation the product model is when a manufacturer creates a product based on what they feel the customer would want or need. They focus more on a higher quality product based on what they feel to be “better” for the customer.
The marketing model gears toward the customer. The marketing model is more geared toward the customer needs and wants. Therefore the customer has many options of a product and the product isn’t scarce. This is based on what the customer wants and research is applied to make sure all of the customer needs and wants are met and then a product is produced.
In my opinion I would say the marketing model is better because it is giving the customer what they want and need based on research that was conducted. I as a customer would always prefer to have a product that would satisfy 9 out of 10 of my wants and needs versus a standard product that I can use for maybe 4 out of 10 of my needs but I only have that product because there isn’t anything else that’s out there.
McCubbrey, D. J. (n.d.). Business Fundamentals.
STUDENT 2: Daina
- Why is a business model important?
Business models are important because they provide a direction for where the company should go. A business model details how an organization creates and maintains value (Wiesner 110). Laying out a plan for the business ahead of time helps the company see the bigger picture on what their ultimate goal is and the steps they should take in order to get there. The business model is more important in determining success (The Importance of Business Models 42). This is because laying out a strategy ahead of time if more effective towards achieving a goal then not having any path of direction.
- How are business models influenced by internal and external factors?
Business models are equally influenced by both internal and external factors. External factors are those outside the control of the business, such as specific state regulations and government regulations (Maçaneiro 8). Internal factors are those which can be found within the business itself, such as senior management assistance and employee skills and abilities (Maçaneiro 8). Internal factors can be more easily changed dependent upon the direction of the business, whereas businesses must adhere to and learn how to incorporate external factors into the business model.
- Conduct a little research on models and discuss the difference between the product model and the marketing model. Is one model better than the other? Explain.
There are a variety of different business models available. The decision on whether a business uses one over the other is all dependent upon the goals of that business. Although there are different types of business models, their primary focus is either more on marketing or product. For example, Direct Sales focuses on selling a product through a network of people(Investopedia Stock Analysis). Normally, under the direct sales business model, there is no set retail location or store (Investopedia Stock Analysis). With a Franchise Model, a person purchases ownership of a business model that has already been established (Investopedia Stock Analysis). Therefore, Direct Sales are more invested in selling the product and a Franchise Model makes its money off of a brand name that has already been successfully developed. No one model is better than the other, the effectiveness of using one over the other all depends on what the goals of the business are.
The Importance of Business Models. (2012). (). Washington: Brookings Institution Press. Retrieved from https://search-proquest-com.ezproxy1.apus.edu/docv…
Investopedia stock analysis: What are some examples of different types of business models in major industries? (2015). . Chatham: Newstex. Retrieved from https://search-proquest-com.ezproxy1.apus.edu/docv…
Maçaneiro, M. B., & Cunha, S. K. d. (2014). Theoretical analysis model of the adoption of reactive and proactive eco-innovation strategies: The influence of contextual factors internal and external to organizations. Brazilian Business Review, 11(5), 1-23. doi:10.15728/bbr.2014.11.5.1
Wiesner, S., Padrock, P., & Thoben, K. (2014). Extended product business model development in four manufacturing case studies. Procedia CIRP, 16, 110-115. doi:10.1016/j.procir.2014.01.014