Cut expense in the Lean Business Model Canvas

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Aug 6th, 2022
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How to cut expense in the Lean Business Model Canvas

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[Music] an organizations business model can be described with nine basic building blocks your customer segments your value proposition for each segment the channels to docHub customers customer relationships you establish the revenue streams you generate the key resources and key activities you require to create value the key partners and the cost structure of the business model but its not sufficient to just enumerate the nine building blocks what you really want to do is to map them out on a pre structured canvas this is what we call the business model canvas the tool that helps you map discuss design and invent new business models lets briefly go through the nine building blocks starting with a customer segments these are all the people organizations for which youre creating value this includes simple users and paying customers for each segment you have a specific value proposition these are the bundles of products and services that create value for your customers channels descri

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What is at the Core of Cost Structures in the Lean Canvas? At its core, cost structures represent all the expenses a startup incurs in its quest to create and deliver value. These are not static figures but dynamic components that evolve with the startups growth phase, market challenges, and internal processes.
The Cost Structure is the last but not least component of a Business Model. It gathers the most important costs involved in the whole operation from the outset. This is the final block, precisely because we need to have all the previous components already defined so we can estimate the costs of each one.
A cost structure means the types and relative proportions of fixed and variable costs incurred by the business. The concept can be explained in smaller units, such as by-product, service, customer, product line, division, or geographic region.
Cost structure refers to the various types of expenses a business incurs and is typically composed of fixed and variable costs, or direct and indirect costs. Fixed costs are incurred regularly and are unlikely to fluctuate over time. Variable costs are expenses that vary with production output.
Cost-driven structures are focused on keeping costs or expenses down. Companies that embrace a cost-driven structure use automation or outsourcing to keep internal costs low, resulting in competitive pricing.
Cost Structure Describes all costs incurred to operate a business model. This building block describes the most important costs incurred while operating under a particular business model. Creating and delivering value, maintaining Customer Relationships, and generating revenue all incur costs.
Cost Structure Example On the side of fixed costs are expenses such as amortization, taxes, wages and benefits, interest, rent, insurance, repairs and maintenance, and information technology. For variable costs, there are expenses such as transportation, utilities, parts, materials, and licensing.

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