A business model is the difference between a business and a hobby. It defines how your business activities will bring in money. Having a clear understanding of your business model helps you focus on the direction your business takes. When you have that understanding you can make informed decisions about what to do and not to do. Sticking to this helps you create a concrete brand, makes decisions about where to take your business simpler, and helps you avoid chasing shiny objects. In order to get that clear vision of your model, here are some tips to follow:
- Define who you work with and how you help them.
- Map out your long-term plans. Where are you planning to take the company?
- Analyze how these things generate income.
- Define your brand.
- When opportunities arise, examine them in terms of the answers to the above exercises. If an opportunity fits within the scope of your business model, it is worth considering. If it does not fit within the scope, do not include it in your existing business. If the opportunity really is too good to pass up, you can create a new business for it.