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Brief Explanation Introduction

How can you deliver your product or service?

Having identified your customer base and the product/service that you are selling to that customer, investors will then turn their attention to how you create and deliver your products/services. This part of the business model can be broken down into two groups of critical partners: your suppliers, and your distribution partners. The former is known as your ‘supply chain’ – these are the contractors you must pay in order to produce your product. The latter is known as your ‘distribution channel’ – these are the partners who help you bring your product to your customer. 

Suppliers: Suppliers are whoever you need to pay in order to produce your product. For a physical product such as the Solar Kit, this includes the manufacturing cost, as well as the transportation costs of getting the product to the customer. For a service such as running workshops, your ‘suppliers’ will be the contractors that you need to pay to deliver the workshop.  

Distribution partners: These are partners who help you to bring your product or service to market. A distribution partner might be someone who offers you a venue for example. Or in the case of SolaRise, its distribution partners might be local stores who stock the Solar Kits, and whose shopkeepers are trained in how to demonstrate the Kits and close sales. Distribution partners often help with marketing as well – for example, a local school that notifies teachers or parents about a workshop being offered by an education venture. Distribution partners may be paid or unpaid, depending on how willing they are to support you because of your social mission. 

Exercise: Define your core product or service

In the prior exercise, you identified your target customer groups, as well as the products/services that could be sold to them. In this exercise, using that same list, for each product and service, please write down who are the suppliers that you need to engage to create and deliver the product, and who are the distribution partners that you need to bring that product/service to your customers? 

Then consider:  

  • Are there any suppliers that you could remove from your supply chain, to improve efficiency?  
  • Are there any that are better or more cost effective than others?  
  • Is there a supplier that you’re not currently engaging who might be more effective? 

 

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