Next up in our examination of the business concept – the product or service definition.
Most small businesses today are part product and part service. Defining exactly what your product or service is, and what’s unique or special about it, is key to creating a strong business concept.
What exactly are you offering? What need are you satisfying? What problems are you solving? The product or service definition outlines what you’re offering, highlighting the benefits.
Here’s an example:
Maria is thinking of starting a bicycle shop. She and her friends often talk about how useful it’d be to call up a bike shop and ask someone to come out to fix their flat tires or other bike issues, just like with roadside assistance for cars. She thinks a lot of cyclists would love it. Maria’s bike shop business solves a problem because her employees would be bicycle experts, and therefore fully qualified to ride out to the other end of the city and do whatever replacements are needed to get cyclists on the move again. Customers can either buy a yearly membership or pay a fee each time they get a repair done. No hassle, and no dragging a broken bike across town to get it fixed.
Maria describes her business through the eyes of the customer:
“Maria’s Mobile Bike Doctors will rush to your location and fix your broken bike. We can get anywhere in the city in 35 minutes or less, and our bike experts can perform any bike repair quickly and with a smile. It’s quick, convenient, affordable and safe. Our customers will be on the road again in less time than it would take to find the nearest bike shop and get their bicycle there for repairs.”
Once you know who your target customer is and what they’re looking for, you can come up with a better product or service definition. This adds to a complete, well-rounded, and effective business model.
(Oh, one other thing: if your product or service is proprietary, it should be included with the product or service definition.)