An industry that is historically unprofitable or operates at low levels of profitablity is the private club industry. Last night in a private club on the 55th floor of a building in downtown Miami someone suggested a good example of business model thinking. Before citing the example, let me once again list the components of a business model, as described more fully in my book, Billion Dollar Company:
- the growth driver--what drives revenue (5 choices)
- the pricing model (15 choices)
- sales and distribution strategy
The example that someone gave me last night was to sell the space in the club in small areas. Every club has 4-5 locations with special, great views. Why not sell these spaces to members to insure that the special location is always available to a particular member or company. This is a variation on pricing model whereby you create additional income from "selling" the club and not just the club services.
Previous posts on business model are here and here. There are an additional 30 posts on business model available through the Lijit search in the right column.