What does business model mean?

Business model is a conceptual framework to describe how enterprises create value, provide value to customers and gain benefits from it. It defines the position of an enterprise in the market, the delivery mode of products or services, the source of income and the cooperative relationship with its stakeholders. Business models can be divided into different types, such as direct selling model, subscription model, advertising model and commission model.

Direct selling mode refers to the way for enterprises to earn income by selling products or services, such as retailers or manufacturers.

Subscription mode refers to the way for enterprises to obtain long-term payment from customers by providing regular services or content, such as streaming media platforms or software service providers.

Advertising mode refers to the way that enterprises earn income by displaying advertisements, such as social media platforms or search engines.

Commission mode refers to the way that an enterprise obtains commission by providing intermediary services for others, such as real estate agency or recruitment platform.

The importance of business model lies in that it provides a systematic way of thinking for enterprises, helps enterprises find their own position in the fierce competition market, and formulates corresponding strategies and operation strategies. By innovating and optimizing business models, enterprises can improve their competitiveness, create more value and achieve sustainable development.