Sustainable Business Model: Key Factors to build the business
You may notice a hype is going on about adopting a sustainable business model, but why exactly is it important? The overall sustainable business model refers to a business model that assured to create and deliver value for its owners without damaging the natural, economic, and societal sustainability.
The ways of adopting a sustainable business model are not very easygoing; there are a few specific measures that need to be followed to be successful in implementing it. Before you start your run, you should have the right idea about a sustainable business model, what it exactly is and the methods to adopt it.
For your convenience, we have gathered up all the necessary information regarding a sustainable business model. Read on to get a more in-depth understanding of this before you start your endeavors to adopt it for your business.
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What are the measures that create a sustainable business model?
1. Commercially profitability.
First, to pursue a sustainable business model your business needs to be commercially profitable. You must assure your niche is determined, your goal is set, and your business has an upright plan for operating. Overall, your business is ready to gain a certain amount of profit from the market.
2. Probability of future progress
Second, to develop a sustainable business model within your business, you must ensure that your business has the potential for future growth. The future progression here is not meant to be profitable for a couple of months, but it means that your business is strong enough to sustain all the ups and downs for the next two to three years.
3. Availability of long-term utilizable resources
Last, you need to make sure that your business resources are worth long-term usability. Without long term sustainable resources, you cannot develop a sustainable business model. Many businesses are limited because of fixed resources or otherwise because of the extremely high prices. In some cases, businesses have enough resources or very low-cost resources, but that are otherwise environmentally damaging. Look for such resources for your business that are cheap, easily available and at the same time environment-friendly. Also, make sure not to take resources repeatedly from the earth, a sustainable business should use its resources by replenishing them. It is better to opt towards a self-sustainable business model in order to ensure that.
Process of pursuing a sustainable business model
1. First, list out your required raw materials for your business. However, this part depends on the category of business you are involved in, the raw material listing will vary accordingly. For instance, if your business is a software company then you will not need any raw material, whereas if your business is a garments company then you will require multiple raw materials from multiple sources.
2. Find out where your materials can be sourced. Where is it being prepared or made? And where is it being sold?
3. Determine where the raw materials are coming from and how are they transported? How long do they have to travel to reach your office or warehouse? How can you reduce fuel miles? Also, find out what are the risky resources on your list? After detecting them look for how can you diminish their harmfulness while increasing their productivity? Also, figure out how you can reduce your reliance on them?
4. Next, decide which production method you are going to adopt. Identify the drawbacks of the production method and determine how you can minimize the drawbacks of this method. It should be cost-effective and also provide the best outcomes.
5. Then, determine the product packaging method you are going to follow? It is necessary to choose among the biodegradable and sustainable packaging in order to maintain a green business plan.
6. You have already identified the riskiest or least durable materials in your list, so find out if you can replace them with other materials or not? If you can replace them, find out if you can do it now or is it better to do it after a while?
7. What are the outcomes you get from your production method? What is the amount of waste material you get at the end? Is there any way that you can reuse these waste materials? Or does it require to be thrown right away?
8. Figure it out if these waste materials can be recycled and used as a resource again or these require putting into another process to make it usable again? Search how you can decrease the proportion of unusable waste.
9. Find the ways how you can lower the number of resources to create an individual product while keeping its quality.
10. Find out the labor condition of your area. Are your hired workers getting a fair payment? Find out if your business process is worsening or improving your workers’ quality of life? Are their efforts being valued?
Benefits of pursuing a sustainable business model
A sustainable business model ensures some practical benefits for your business. Some of them are highlighted below.
- A sustainable business model successfully increases productivity and also reduces overheads.
- It improves brand image in the market and leads it to a higher competitive position.
- Enables a business to grab more attention from buyers as well as investors.
- It ensures the reuse of waste outcomes; thus, it minimizes the wastage.
- It also increases the ability of the business to comply with the rules and regulations given by the government.
In conclusion, throughout the article, you will learn about the key aspects of a sustainable business model. You will understand that following a sustainable business model is not a privilege today, rather at present it is important to preserve the natural aspects and use fewer raw materials from the earth while ensuring the profitability of your business.