Are you a business owner who is experienced double digit revenue decreases due to the current economy? Or an employee who has been laid off or is at risk for being laid off? If so, you need to learn about profit model thinking.
What is Profit Model Thinking?
Profit Model Thinking is a way of looking at your business or your experience and expertise and seeing multiple ways you can leverage it to create additional income streams. What I teach and discuss will get you to think about what other profit models or markets can apply to your current business. Let me give you some examples to show you how profit model and marketing thinking has helped.
Profit model thinking is the reason why entrepreneurs can make a lot of money in times when the rest of society is struggling. They play offense by seeking out and capitalizing on opportunities when others are playing defense.
How Can Profit Model Thinking Benefit Me?
By mastering profit model thinking, you not only will make more money but you also will create more financial security because you will not be selling on just one business model or one job. The great thing is that there are multiple opportunities already available to you within your business or your skill and experience set. All you have to do is know how to seek them out.
You see, in any economy, there is always a way to provide or add value to your potential customers. It just may change as outside forces change. By learning about profit model principles and marketing, you can always find new ways of creating value or solving problems in a changing environment.
The best way to explain how profit models can apply is by providing examples:
EXAMPLE # 1: Identifying a New Marketing Channel for an Existing Product / Service
For example, I run an online business that sells legal entity formation services for new business owners. In late 2008, employees were being laid off everywhere. It was the first time in my life where close to 1 out of 3 people I knew lost their jobs.
I realized that many of these displaced workers had a lot of experience and expertise. With the average time for being out of work rising to 22 months at one point, I figured they would need to start thinking of other ways to generate income to provide for their families.
One way would be to set up their own consulting or services businesses and trying to find their own clients. I started to see support group and programs popping up to teach people about being self employed and small business. I saw this as an opportunity to marketing my new business entity formation services to ex-employees starting self employed consultations or small businesses. It was a new way to market my services to a new market of new business owners.
EXAMPLE # 2: CREATING A NEW PRODUCT AND PROFIT MODEL BASED ON AN EXISTING ONE
I recently met an entrepreneur who runs a tax preparation business. He started this business using profit model thinking by leveraging his expertise as an employee working for H & R Block to create a new business.
His business was healthy and growing but the market started to get more competitive with other tax preparation businesses and deep pocked franchises coming into the area. Then the software products came out (like TurboTax) which further took away market share.
He continues to run this business because with smart marketing and business principles, he can still acquire and maintain a strong customer base. But, in addition, he saw other business models based on the challenges he had in his own business. He had troubles finding skilled people trained to do tax preparation. So, he created an online tax preparation school which teachers and trains tax preparers using e-learning courses.
His new business has now surpassed the revenue from his old business. And, it came about because he used profit model thinking at a time when he started to feel some insecure with the changing landscape of the tax preparation industry.
This success was all born out of his knowledge and challenges from his profession and his ability to take action. And now, not only is he making money from two profit streams but he is not as dependent upon one profit model stream. This translates to more business success and more financial security.
Summary
The pace of business is unprecedented. And there is no longer any stability in employment. Profit Model Thinking lets you play offer by creating additional income for yourself but it also creates an effective defensive strategy because the more profit models you create, the more protected you are from unanticipated business or employment changes.