What is the best business model for your startup? B2B or B2C

What is the best business model for your startup? B2B or B2C

Let's assume that you have done your homework, you learned as much as possible about the market and that you have discovered possible tangent opportunities that you could have possibly targeted with your current resources but instead decided to stay with this idea you are now looking to develop and make money. The question now is how do I make money? subscription, traditional retail, online, contract? First lets consider what kind of business you have and whether or not you could benefit more and find more benefiting clients in the commercial or the public markets. Sometimes your best most appreciative and willing to pay customers are businesses sometimes they are not.

The process of choosing which business to start is often done incorrectly and does not factor in the experience level of the entrepreneur or lay a foundation for the first-time business owner to grow both personally, professionally and fiscally.

The issue with many business plans is that, they fail to take into account certain variables that can determine whether a business is scalable and sustainable, such as search engine marketing competition, the hassle and entrepreneur’s inherent ability to recruit and manage outside manufacturers as various globalization factors will flood a market.

With the advent of the web and technology you might be tempted into following trends- selling subscription based, crowd sourcing your employees or packages sold online, but what may be a cost-effective business now could be a nightmare waiting to happen.

On the other hand, B2C startup companies can be very difficult to launch and grow even marginally because the consumer is generally very price sensitive, socially sensitive and time constrained so it requires a higher level of insight and expertise to conquer a Business to Consumer business offering. Is actually businesses that operate in B2C that greatly benefit from Unthink's MBA expert consultants.

Despite factors such as a cost-effective start-up that should be considered major tailwinds, why do so many of these businesses end up becoming a hobby alongside a full-time job?

The reason these companies fail is simplistic. Many entrepreneurs don’t venture into industries that are truly needed by the market. Things such as social media, online vacation packages, online dating and video production are not a necessity for businesses or the consumer to purchase and often prove a lot harder to break into than the business plan formula claimed it to be.

As a B2C you might face location challenges because you lack a physical location therefore you must consider acquiring a store or office front to have a point of reference and allow prospecting clients to visit you in person.

A B2B startup company can leverage a strong position online with search marketing, seo, proof of concept, at least 1 client and focused clarity to sell a second and third large client. But your game should be on point with every detail thought out and a solution ready to be implemented in case of any emergency. You cannot fail a corporate client.

Closeup of shaking hands after business meetingTo mitigate a failed start, I have attempted to lay down some industry and target market boundaries from which the entrepreneur can safely use to pick a business that has a fighting chance from the onset.

For one’s first business, I always suggest that they start a company that sells services to other businesses rather than directly to the consumer. There are a few reasons as to why entrepreneurs should venture into “B2B” (“Business to Business”) service based companies as opposed to any form of “B2C” (“Business to Consumer”) company, “B2B” product-oriented company or strictly a web-based B2B firm.

Prior to getting into the reasons why the first-time entrepreneur should play within these boundaries, let’s define and give examples in order to clarify the difference between a “B2B” service-based company, a “B2B” product or web-based company and, finally a “B2C” company.



About the Author:An Unthink Growth Expert

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