The economic impact of Brexit and the pandemic has triggered many problems all over the UK. Surviving an unstable economy is a daunting task. But some business models have succeeded in facing the challenges and show impressive growth. Here are some of the business models that have achieved excellent growth in recent years.
Customization
The shift in consumer preferences has led to an increase in personalized goods. Automotive makers for instance make cars in the colours you want and add features that are tailor-made for the customer. In the clothing sector, you can pick the size, style, colour, and budget you want.
The luxury bathroom provider, Letta London is another example. The company recently opened their luxury bathroom showroom in North London. You can find bathroom fittings and fixtures of all popular brands. The corner bath collection offers compact, yet spacious baths in all styles, sizes, and budgets, and you can find some really good deals for different types of corner baths.
On-Demand
Instant gratification is a prevalent trend now among consumers. Convenience, speed, and simplicity are key factors in the on-demand business model. Many start-ups now use this model to provide services and products with just a single touch.
Take the startup Handy for instance. It provides handymen quickly to consumers. Getting any of the odd repair jobs done quickly is a very difficult task to achieve. But thanks to services like Handy, you can now fix any repair in your home quickly.
Freemium
In the past decade, businesses have used the Freemium model with success. In this format, you get the basic services of a business for free and to enjoy the premium services or advanced features, you need to pay. Mobile games fall under this category. You can play the basic features for free but you need to pay to enhance your gaming experience.
Some business charges third-party apps or developers instead of their users. The Google Play Store is a good example. The app is free to users. Google profits from the service via the brands that sell through the store. The app also serves as the brand’s advertiser. This is called the ecosystem model.
Direct sales
In the past five years, the direct selling industry has increased at the rate of 2.4% per annum and is now worth £2.6 billion. The pandemic and reduction in industry revenue overall have influenced the rates for all.
Instead of using single level marketing, the industry now uses multiple-level marketing. However, the model is very identical to the fraudulent Ponzi schemes and illegal pyramid methods. The similarity has many industry experts concerned about the safety and reliability of the business model.
Ann Summers is an example of the direct sales model. You need to purchase the basic kit valued at £500. You need to pay rent money of £3.50 every week for 32 weeks or until the payments are made worth £1200. You get to sell the products at a 23% discount and you earn £23 for every £100 worth of a sale. You can purchase the products at a 30% discount.
Subscription
Subscription-based services are growing at a fast pace. Consumers find it easy to set up and use. Once set up, consumers need not worry about receiving the product or service every month. This is a popular model as it provides benefits for the consumer and the business.
Customers find it convenient and simple to use. There is no hassle of reorders. A flat rate is offered for the duration of the subscription so budget is not a problem. For the business, the revenue is predictable via recurring sales. The company’s value increases and makes it attractive to potential buyers.
Netflix is a great example. The monthly subscriptions have revolutionized the way we watch movies and TV shows. Similarly, the music app Spotify has given users an easy way to listen to their favourite music for a minor subscription fee.
Reverse auction
In this model, buyers take on the role of sellers. Buyers who are interesting in a price offer can sell it to the seller. If the seller accepts it, the buyer should abide by all the terms and conditions of the seller.
Buyers find the price a good bargain while sellers found the easy marketplace access a big advantage. Priceline is a good example of this model. It is a travel app that provides affordable tickets, rentals, and accommodation.
Conclusion
A well-planned business model is a great boon to business owners. It helps you begin your business and run it successfully. Lack of proper planning will affect the precision and effectiveness of the operation. The various business models explained above help you to determine the service, your customers, value, and tools you should use to ensure higher profitability. Using the model, you need to devise a plan that will help you taste success with the model.
