Entrepreneurship 101: Understanding Business Model Canvas - Costs

We've covered most of the aspects of the Business Model Canvas. In the last post we learnt about the Key Partners. Key Partners are one of the most important people/entities that enable your business. In today's post we shall look into another key aspect of the Business Model Canvas - Costs.

Costs in Business Model

No matter whether you are running a kirana store or a mammoth conglomerate, one thing that every business owner wants to reduce are the costs. Every business, every activity incurs cost. The costs can be towards administration, day to day operations, people and so on. Most of these costs are fulfilled from the profits the business earns. Hence it's vital to keep the costs down so that you can have better margins and put the profits to better use.

Business Model Canvas - Costs

Example Business Model - Costs

Like our previous posts, we are continuing with the Uber Business Model example. For a company like Uber, what do you think are the costs for the company ? One of the major costs is maintaining the technology infrastructure - servers, apps, etc. They also spend a lot on Advertising - Didn't you see Virat Kohli ads during the ICC World Cup 2019 ? and the salaries they pay to their employees.

Business Model of Uber. Image Courtesy: BMI Inc.

That's about Costs in the Entrepreneurship 101: Understanding Business Model Canvas - Costs. Costs are an important metric for any company. Everything they co incurs costs and the end goal is to reduce the costs and increase the profits. What do you think would be the costs for Google ? Share your thoughts in the comments below.