The Art of Business Structure


For many, the love affair with the Captains of Industry is long over and we are inclined towards distrust and uneasiness with the behemoths of the global market. Undeniably, they shape and dictate much of what we decide in terms of the way we communicate, educate and experience life. With such a inescapable dependance, whether gladly or compelled, we find ways to liberate ourselves from their dubiously benign holds.

Consequently, it could be said that we are living through the second dawn of the “Mom & Pop” spearheaded by the later generations who have a once-removed nostalgic romance with the startup success stories of old.

There is nothing new under the sun but there is no end to new perspectives and improvements. Trade and doing business is one of the oldest things under the sun and now more than ever it is being viewed in different lights and from different perspectives. With so many industries near saturation and marketing being done for marketing’s sake, the small business owner can feel like they are at the foot of Mount Everest wearing bermuda shorts and flip-flops tasked with reaching their niche way at the top. At least, that’s how we’ve felt.

Simply, a business structure has to successfully accomplish “product meet customer” over and over again through a trusted channel. Structuring this has becoming as diversified as the products available on the market today. In the new entrepreneurs handbook (I say), Business Model Generation, the author defines the business model.

A business model describes the rationale of how an organization creates, delivers and captures value.”

Before, this would pop lots of ugly and intimidating excel charts in my head with graphs and numbers (ewww) everywhere but really we should think as creators. The business of your business has to be fashioned. Think of your product, assets & resources as your paints oils to put onto the blank canvas that will hopefully be the masterpiece that is your thriving company.

Personally, I knew that we must have a business model and I just didn’t know what exactly it was. The whole drama of the kitchen, see previous posts, and the possibility of a) not being able to produce in a commercial kitchen meaning b) that we cannot put it on retail shelves in Toronto. This forced me to really understand every aspect of our purported business structure. Kinda like this.

Business_Model_Canvas

Once we did that we realised that to keep totally legal and reach our customers we had to seriously rework our distribution channels given the scenario that we cannot produce in the kitchen. Having a unique product is great, having piercing and effective marketing indispensable but having a solid and fuctional business model is the make-or-break element of any enterprise.

In our first post we iterated the importance of knowing your legal situation. We had to look at what our distribution would look like in the channels that allow pre-packaged foods to be retailed while not being produced in a commercial kitchen. This scenario meant a lot more avenues with less cost but with a less coherent reach. It also, introduced the need to have a very good shipping set up.

The unpleasant taste of uncertainty is always mixed in with the high hopes and big dreams. Required: the correct balance of optimism, realism and flexibility. Now for the stats of the week.

Succesess

We went to see a commercial kitchen and are reviewing the lease agreement, which is super flexible. It’s in a cost range that is feasible!!!

We have all the financials down and are able to manipulate to see a myriad of different cost and revenue scenarios.

Leaps and bounds in product developement.

Setbacks

Not seeing eye to eye with packaging designer.

Mama FlavourFull

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