The-definition.com

Definition

Business Model

Business model is a company’s plan or diagram for how it competes, uses its resources, structures its relationships, interfaces with customers, and creates value to sustain itself on the basis of the profits it generates.

The main reasons that having a clearly articulated business model is important are as follows: It serves as an ongoing extension of feasibility analysis, it focuses attention on how all the elements of a business fit together, it describes why the network of participants who are needed to make a business idea viable would be willing to work together, and it articulates the core logic of a firm to all its stakeholders.

Share it:  Cite

More from this Section

  • Window of Opportunity
    Window of opportunity refers to the time period in which a firm or an entrepreneur can ...
  • External growth strategies
    External growth strategies are referred as growth strategies that rely on establishing ...
  • Free enterprise
    Free enterprise is a system in which private businesses are able to start and do business ...
  • Evaluation
    Evaluation is the stage of the creative process during which an idea is subjected to security ...
  • Resource Leverage
    Resource leverage is referred to as the process of adapting a company's core competencies ...