Three key partners who matter most in business model

The number one building block in the business model is key partners. Out of several of them, one can identify the following three as most important in getting the production off the line to be shipped out. Here are the three guys:

Suppliers:    The question what is on offer, invariably leads us to the production of good or provision of service. In order to produce goods or provide services a firm needs materials that must be processed in a specific manner. Suppliers play multiple roles in a business: providing general materials and supplying critical/ special materials.

Suppliers have two more hats. One is where they take responsibility in providing specialised technology services to go along with the supplies. At this point they morph into service providers. Another hat they wear is when they give business supplier finance, a line of credit that is interest free. Here, they don the clothes of finance providers.

           

Service providers:  Right now, we are unable to limit the role and relative position of service providers in value network as they seemingly appear in value creation, delivery and capture. They are sometimes suppliers of associated materials and in other instances they could come as service providers as in the case of consultant designers in jewellery. Independent quality assurance is yet another item provided by them.

Business partnership is often struck as joint venture, strategic partnership or assured suppliers like the diamond suppliers in Blue Nile Jewellery. Moreover, agents, representatives and distributors are functionaries in sales who easily pass off as partners. Franchise holders and re-sellers also come on the border line

Utility providers:  This group has one thing in common: they do not supply any materials. Other than this, they contribute to a wide ranging of activities beginning from the production to the final sale. A typical company deals with several of them in utilities such as power, electricity, and water and in provision of external services required in production function. A good example is security service which is often contracted put.

 

Cheers!

 

Muthu Ashraff Rajulu

Business Strategist

Mobile: + 94 777 265677

E-mail:   cosmicgems@gmail.com

Blog:   Business Strategist