How I Choose a Business Model
By Christine OKelly | September 16, 2007
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Whenever I develop or market a new business, there are a few guidelines that the business model must fit. So far, this has been extremely effective.
Sell in Bulk
I don’t like selling products or services one at a time. I found it to be far too expensive because of the money it takes to advertise and the time it takes to acquire a new customer. Instead, I always look for a way to sell products or services in large quantities.
Instead of setting a full price, I set a reduced price and allow others that already have the contacts I need to take a cut of the profits.
With SEO Content Solutions, rather than targeting individual businesses, I decided to reduce my costs and work with SEO and web development firms that are always in need of content for their customers while allowing the SEO company or web dev firm to expand their private service offerings and earn additional profits. For Trip Booking Direct and Private Label Travel Agency, I will target businesses that already book a lot of travel. With My College Fundraising, I developed a fundraising program for schools that will allow me to sell a gift product in bulk rather than targeting individual parents. And for YTB Hosting, I will leverage the network of people who already drive those they are consulting to purchase domain names and hosting for their new business.
Positive Vibes Every Step of the Way
I only develop businesses that impact people positively every step of the way. From the product itself, to the people involved in the sales process, it has to be a positive experience all the way around.
In terms of my copywriting services, the end client gets greater visibility and higher search engine rankings. With Trip Booking Direct, travelers can get low cost rates to enjoy a new experience. For Private Label Travel Agencies, anyone can earn 60% commissions by working from home doing something fun. And with My College Fundraising, students get a fun surprise, parents feel great, and the school organizations earn money.
Low Start Up Costs
Every one of the businesses I’ve launched has cost me almost nothing. I don’t like to invest a lot of money in a business because I know that it’s not necessary in order to earn big profits.
No Physical Boundaries
Thanks to the internet, there is no need to be physically present to deliver great products and services. Being tied to a physical location without the ability to scale can (not always) limit your potential market significantly. Believe it or not, I have never met on individual that I work with personally. I’ve been working consistently with some of these people for more than two years.
Automation
Automation is a new guideline of mine for starting a business. Aside from my personal copywriting services, every other business model is designed for automation so that I have the time to work smarter and not harder. Otherwise, I would not have the time or patience to pull in this many different revenue streams.
Your Opinion!
What are your guidelines for starting a business? Does your business model utilize any or all of these principals? What are some other good guidelines to consider when starting a new business?
Topics: Business Development |
8 Comments »
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For me the number one priority is that the business must be able to run without my personal involvement after it is through the initial stages. I’ve been caught in the past with a service business (that I still run) where I am the reason the business still operates. Take me out and the clients disappear. What value is there to that? A job for me and a business that is very hard if not impossible to sell.
I agree totally about low start up costs. Go to a bank / business adviser and they talk about grand business plans, budgets blah blah - they generally don’t know what they’re talking about - mainly because they have an employee mentality.
I hear ya Mark! I am in the exact same position as you are. I’ve built a successful service business that can’t grow without me. I have made changes to make it scalable, but now am going for AUTOMATION.
I know you’re as big of a fan of Tim Ferris as I am and his chapter on automation was what drove me to launch My College Fundraising (http://www.mycollegefundraising.com) after 13 years of “thinking about it” and launch Trip Booking Direct (http://www.tripbookingdirect.com) this month. Both fit are perfectly designed for automation.
Thanks for your feedback!
I like everything here so far, good job girl.
Oh hey, one thing, from your site page http://seocontentsolutions.com/website-copywriting.html
“Your customers don’t by products they buy solutions that help them to achieve their goals.”
That first “by” is definitely incorrect *wink*. Yeah I’ve considered this same line of work…
lol - thanks Jon! I made that change right away!
[…] If you were like me, you own your job and want to make the change, now what? Check out Amanda’s post on the 5Ws and pick up a copy of the E-Myth Revised. And perhaps check out Christine’s How I choose a business model. […]
How do you go about comming up with an idea for a good automated business? I run a one man web design shop. www.connectioncube.com. I would love to leverage my skills to start an automated business.
Hi Sean! When you actually do custom graphics as a service, it’s difficult to automate! However, I have some ideas for other ways to create passive income with your skills:
Create stock graphics for sale on sites like iStock Photo.
Use what you know create an info product for sale to teach others - such as screencasts of how you do certain techniques, or ‘how to start your own freelance’ design company. This is work that you will do once, but then can resell several times.
If I have any other ideas - I’ll let you know!
Christine
The idea of creating stock graphics is good. I haven’t pursued that.
I really like the idea of teaching others. I actually just launched my first blog a couple weeks ago. Its aimed at teaching people how to use Adobe Illustrator. The site is www.aiburn.com. If it does well maybe I could leverage it into a community.
Its my first project like this. I’ve watched the Eden Creative Community do really well with the start with a blog and grow into a community concept. Like Freelance Switch. That’s inspiring.
Thanks for your comments. I just found your blog today and added you to my feed reader.