Business Model Canvas
A business model canvas is a strategic planning tool that can help you illustrate and develop your business model. It’s easy to use and gives a condensed summary of what your business is about, i.e. your business plan. The business model canvas is divided into the following nine sections or building blocks:
- Key partners,
- Key activities,
- Key resources,
- Value propositions,
- Customer relations,
- Customer segments,
- Revenue streams;
- Cost structure.
Developing your business model canvas is the first step to starting your own business and plays a crucial part in expanding that further into a fully contextualised business plan.
We have created an easy-to-use template to build you business model canvas – download your copy below.
Whereas the business model canvas can be used as an executive summary of what your business is about, your business plan is a comprehensive roadmap for what your business is about. The business plan should ask and answer the following questions:
- Who you are,
- What you plan to do,
- Why you plan to do this,
- How you plan to do it;
- With whom do you plan to do it.
Both the business model canvas and business plan are useful to get external stakeholders to understand your business. These external stakeholders could be banks and other lenders, potential investors, potential employees, and many more. Practicing your key talking points in your business plan is essential to get the ear of any of your stakeholders during the first few weeks and months of you starting your business.
One of our trusted partners and ultrapreneurs is Oluchu B. Kolanisi, an accomplished corporate professional, coach, and author. In one of her talks, she highlights the importance of practising your key talking points about your business plan, as one of the best ways to build your confidence and also toughens you up to when you get rejected by people who may not believe in your business.
Registering a company
At this point, you might be asking, well why create a business plan when the company has not even been registered? The simple answer to this is that many people register companies, that’s one of the simplest things to do, however, merely registering a name and taking the next steps to start a business are two different things. Planning is important to get you motivated so that you can see through your entrepreneurship journey.
The Ultrapreneurs Network offers a comprehensive suite of solutions to help you register your company, and we’ll share a little secret with you: you need to only register one company and operate many types of businesses under that same company. Not only do you save money on registration fees, but also can save on administration fees and fees paid out to your tax consultant and others. Our Business Registration packages are shown below.
Opening a bank account
Opening a bank account is one of the best ways that keep you disciplined about seeing through the starting of your business. Think about it, if you open a business bank account and not bring any income into that account, you will still pay for the fees associated with keeping that account open. This is an unnecessary cost if you have no intention of seeing through your entrepreneurial journey.
There are two ways to approach your banking.
- Using your existing or new personal bank account
- Using a new business banking account
In the table below are the pros and cons of each option. However, whatever option you choose, you must have a bank account as a business owner.
Selling and Payments
Selling and accepting payment is the business of doing business, i.e. operating. The whole purpose of you starting your own business is to sell something — be it physical goods, digital goods, services, and so on. When you sell, you need to accept payment in some form or the other. Do you see how important a bank account is now?
There are may payments options out there, but the ones that are most likely to be relevant to you for the first year+ of your business are cash, card and electronic payments, and we explore these in turn below.
- Cash payments
Accepting cash is not only relevant to physical stores and businesses, but important for online businesses as well. For the latter, this is made possible by cash-on-delivery services, where your buyer pays at the moment their purchase is delivered to them. This cash is then either delivered to your place of business or directly into your bank account by the courier. There are many advantages to this, which we will cover in another article, but one of the most important is that this can (as with other cash payments) can reduce your transaction costs.
- Card payments
Here, we make a distinction between your customers using a card at a physical location and them using that same card for online payment processing. The use of card payments in South Africa has become almost universal due to COVID-19, with tapping and scan-to-pay usage seeing multiple digit usage increase since the outbreak of the pandemic. Traditionally, the issue of card-reading machines has been the domain of the big banks, but more and more fintech companies are offering these services, with Yoco and iKhokha being the most prevalent in South Africa. Best of all, these are now as affordable as R199,95 for a Yoco, and allows you to take in card payments anywhere, anytime.
- Electronic payments
E-payment has existed in South Africa since the late 90s but has grown substantially over the past 5-10 years due to better access to the internet. FNB’s eWallet is by far the most widely used form of e-payment in South Africa, but this has largely been for person-to-person transactions and less so person-to-business transactions. An increasing number of businesses are starting to use such wallet services, with private drivers in the ride-hailing industry allowing riders who would otherwise pay with cash, to use eWallet instead. This trend will continue to grow, and can potentially be even bigger in rural areas where most people remain unbanked or have limited access to other payments methods besides hardcore cash.
Electronic payment however goes beyond the eWallets of the world and is a space that has opened up to all business owners in South Africa. Companies like Payfast, Yoco, and iPay have allowed many entrepreneurs to grow their online business sales by making it easy to accept online payments through their payment portals, and as bank card penetration in South Africa’s urban areas and economic hubs is one of the highest in the world at over 80% of consumers, this has opened up a huge market for businesses.
Covered here is the easiest way to start a business in South Africa, where the focus was on the business model, the business plan, registering a company, opening a bank account for your business, and the various payment methods available to you to accept payment for sales. Each of these warrants its own articles, which we will create so that your journey to being a business owner is made as easiest as possible with our help at Ultrapreneur.
Ultrapreneur is a business as well, and we pride ourselves in the work we do to help entrepreneurs. For a comprehensive consultation and planning to open and operate your business, contact us below or see our suite of products and services here.