- On June 30, 2018
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- business, canvas, partnership, startup
Key partnerships in the Business Model Canvas
When we know that our enemy is unbeatable, we better run and hide… or try to do business with them. Toba Beta, Indonesian writer.
One of our business model canvas blocks is about strategic partnerships. This block leads entrepreneurs to identify the key partners who will contribute to the development of the product or service to be generated through the business model.
Our key partners can offer us the raw material needed to develop the finished product. For instance, if your product is artisan paper, it would be interesting to make contact with companies that do not recycle their trash but instead throw used sheets away.
It would not represent trash to you, but it would rather mean “pure gold” given that it can be the raw material needed to develop your finished product.
During a conversation about the most wonderful stories related to key partnerships, a researcher told us about Arnold Fornachou. In the early 20s, Fornachou had a thriving ice cream business that gained popularity over time.
On a warm summer day, he realized that ice cream sales at a St. Louis fair were being more successful than he had expected. Sales were so surprising that afternoon that he ran out of cardboard plates to serve the product. Customers who had already ordered were waiting. Desperate to find a solution, Fornachou asked the nearby seller if he could borrow some plates from him.
His kiosk neighbor was a Syrian pastry cook named Ernest Hamwi, who was unsuccessfully trying to sell a thin cookie known as zalabia in the Middle East. Suddenly, Ernest had a “eureka” moment and gave a rolled zalabia to Fornachou. The cookie was shaped like a cone. When it is freshly baked, zalabia can take almost any given form.
As soon as the Syrian seller gave Fornachou a cone-shaped cookie, they started serving all the ice cream customers together. They replaced the cardboard plate for the cookie, which was actually edible.
Until now, these businessmen are considered the creators of the ice cream cone that is still used today. Surprising, isn’t it?
The process of filling out the business model canvas includes going out to test the products in order to find answers and solutions in the first stages of development. This testing process can help create value-added products.
The ice cream story obviously shows that there was no prepared trial as taught by the lean startup model. Still, it is an excellent example to better understand how important it is to carry out tests before product launching.
The thing is that Hamwi, whose zalabia sales were unsuccessful, and Arnold, who had run out of plates for serving his product, joined forces that day and faced business challenges together. Nowadays, this is called win-win thanks to a strategic partnership even though they did not know that concept by the time they became partners, neither had they heard about the business model canvas. In fact, their partnership began a long time before the canvas appeared and business models were only designed for big companies.
This story must be inspiring for those who now know how to thoroughly study a business model. From the beginning, we know that we will be testing the product launching. The “eureka moment” may occur during the experiments. ¿The moral of the story? Key partnerships are extremely important and everyone involved in them can benefit.
We invite you to use our Innovative Canvas to make informed decisions about your partners and other key aspects of your business model.
Download it here and share your experience in the comments below.