The Alegre Pty Ltd is primarily concerned with utilizing the different resources of the planet efficiently and ensuring that the different electronic devices that are used by the individuals can be kept away and used as a refill. The company aims to offer a full life cycle solution to the customers who tend to change their electronics regularly (Alegre.net.au., 2018). The company runs on the concept that the individuals who upgrade to the latest trend often are unable to dispose their older gadgets and hence, the get obsolete. For this purpose, the company has arranged a partnership arrangement with different retailers in order to enable the customers to trade in their previous devices so that they can keep moving on the gadget chain.
The quality services as provided by the organization ensures that all previous data is removed and the device is restored to original factory settings. Hence, the firm works parallel with the electronic industry (Hong & Fauvel, 2013). The report will be deconstructing the business canvas model of the firm and providing recommendations on the same.
Business canvas model
The business canvas model is a strategic management tool which is largely used to understand the components of the business enterprise (Armstrong, Kotler Harker, & Brennan, 2015). The business canvas model comprises of nine building blocks which will then assist in understanding of the positioning of the business enterprise.
The business model comprises of nine building blocks which have been stated as follows:
The customer segments of the company have been given as follows:
Companies- This may comprise of various organizations which make use of various electronic devices. This may be computers, air conditioners, television sets, communicating devices and other related products.
Individual customers- They may have possession to electronics for personal use.
Families- The families may also be targets as they may deploy electronic devices at their homes (Kiel, 2014).
Hospitals- The hospitals may also make use of various electronic devices which need to complete the complete life cycle.
The key partners of the firm are as follows:
- Retailers- The retailers are the partners which sell the electronic products.
- Suppliers- The suppliers can also be taken to be the partners
- Data teams- Who help in past data erasing (Dudin, Kucuri, Fedorova, Dzusova & Namitulina, 2015).
- Logistics- Who help to collect the bulk from the client’s home.
The value proposition of the company is as follows:
Fast and easy- The procedure of selling and purchasing the item is very fast and just a click away
Data destruction- They remove all previous data and ensure privacy of the system.
Excellent pricing- Their valuation pricing scheme is very competitive (Zott, Amit & Massa, 2011).
Sustainable- Harmful waste is reduced.
Figure 1: A snapshot from the website of Alegre Pty Ltd.
(Source: Alegre.net.au., 2018).
The key activities of the firm are as follows:
1. Pick up from houses
The company offers pick up services from the house or from the source point of the different consumers and companies alike.
2. Data destruction
The company allows data destruction facilities from smart devices.
3. Excellent offers
The company provides excellent offers to the customers and various loyalty programs.
4. Trading Programs
They also provide trading programs.
The different channels which are primarily used for the operations of the company are:
Online: The request for the buyback option can be made on an online portal request. This shall go a long way in assisting the company to ensure that the initial procedure becomes easier.
Physical: The physical pick up option from the source (customer) is the second channel.
The company earns the revenues from given sources:
The company resells the factory restored item which then makes them earn large profits (Joyce & Paquin, 2016).
The company also earns adequate commissions by decomposing the products from the different retailers.
The cost structure of the firm has been given as follows:
Logistics cost: The Company offers free collection from the source destination which then adds up to the cost of the firm
Data team outsourcing: The data destruction procedure also adds up to the costs.
Cost of sales: The re-sailing cost (DaSilva & Trkman, 2014).
Human resource management: The cost of human resource management and sales team salary
The key resources are as follows:
- Intellectual rights
- Human Resource Management
- Knowledge and Brand name
The given procedure helps to maintain customer relationships:
- Free pickup- The Company picks up the products from the homes and offices.
- Loyalty plans- The Company also offers loyalty programs to the different customers.
- Discounts- Various discounts and buyback offers are also provided to the customers.
- Prices: The Company provides high buy back prices.
The business canvas model can be described as an effective tool which helps in the understanding of the different business components and also goes a long way in helping to analyze the way in which the company works and functions (Sinkovics, Sinkovics &Yamin, 2014). A business can be described as a single entity and any change in one of the aspects of the organization may have an impact on the other. This can be explained better with the help of an example.
For instance, the company Alegre decides to expand its key activities and sell new electronic devices as well, then in this scenario, the firm `s key resources will have to be increased. In the same manner, the cost structure of the firm will also change considerably, once the organization is able to make the given move successful, the revenue stream may also be impacted (DaSilva, C. M., & Trkman, P. (2014).
Another instance, may be given with regard to the customer relationship techniques. The customer relationship techniques are considered to be crucial aspects of the organization and any change in that may lead to a change in the cost incurred.
Critical success factors
The critical success factors of an organization can be rightfully described as the factors, the employment of which brings about success to the organization. The critical success factors of Alegre have been as follows:
- Innovative idea: The entire concept behind the idea has been very successful in nature and the re-sue of the electronic gadgets has been an innovative idea. Hence, for this purpose, the organization has been able to perform well.
- Great prices: The prices and valuation as offered by the organization are very attractive and this has been the reason, that the firm has been successful.
- Good supply chain connections: The firm has sound connections with various companies and retailers which has further favored the organization.
The downside risks can be described as risks which can take place in the organization as a result of certain outside forces or concerns (Bocken, Short, Rana & Evans, 2014). The different downside risks as associated with the organization has been given as follows:
Data Theft: The data which is being stored in the previous electronic devices might be stolen by some of the members of the organization or through some hackers. This might be able to break the trust of the organization in the eyes of its customers.
Faulty products: The products which may be provided by the customers may be faulty in nature and might not be in a working condition (Massa & Tucci, 2013).
Future risks: Moreover, after the configuration and quality tests have been done, there might still be chances of the product not functioning well in the future and this may lead to questions on the brand image.
Business model changes
After the analysis, I believe that the organization has been performing considerably well, however, there are a certain number of changes I would recommend the given changes to the business model:
- Increased activities: The Company may increase its offerings which are being made by the company to the different customers (Carayannis, Sindakis & Walter, 2015). This will then assist he organization in ensuring that the firm performs better.
- Improved proposition: The value proposition as offered to the different clients may also be improved and better quality may be provided to the different users.
- Better pricing strategies: The organization may price its products in a better manner and offer higher buy backs.
From the given analysis, it can be concluded that the business idea behind the given business, Alegre is very innovative and that it supports the environment, which is greatly supported by the government as well. However, there are certain recommendations which if followed will have a positive impact on organization.
The following recommendations will be made for the organization:
Adding more to its value proposition
The company can thereby add additional activities to its value proposition and this can cause the improvement in the revenue of the organization.
Improving the buyback policy
The pricing and buy back valuation of the electronic products needs to be improved considerably. This will improve the brand image of the organization.
Following an integrated marketing approach
After following an integrated marketing approach the organization will be able to successfully be able to attract a larger audience.
Alegre.net.au. (2018). Alegre PTY LTD - The Buyback Experts for Electronic Devices. [online] Available at: https://www.alegre.net.au/ [Accessed 1 Aug. 2018].
Armstrong, G., Kotler, P., Harker, M., & Brennan, R. (2015). Marketing: an introduction. Pearson Education.
Bocken, N. M., Short, S. W., Rana, P., & Evans, S. (2014). A literature and practice review to develop sustainable business model archetypes. Journal of cleaner production, 65, 42-56. DOI: https://doi.org/10.1016/j.jclepro.2013.11.039
Carayannis, E. G., Sindakis, S., & Walter, C. (2015). Business model innovation as lever of organizational sustainability. The Journal of Technology Transfer, 40(1), 85-104.
DaSilva, C. M., & Trkman, P. (2014). Business model: What it is and what it is not. Long range planning, 47(6), 379-389. DOI: https://doi.org/10.1016/j.lrp.2013.08.004
Dudin, M., Kucuri, G., Fedorova, I., Dzusova, S., & Namitulina, A. (2015). The innovative business model canvas in the system of effective budgeting.
Hong, Y. C., & Fauvel, C. (2013). Criticisms, variations and experiences with business model canvas.
Joyce, A., & Paquin, R. L. (2016). The triple layered business model canvas: A tool to design more sustainable business models. Journal of Cleaner Production, 135, 1474-1486. DOI: https://doi.org/10.1016/j.jclepro.2016.06.067
Kiel, I. H. (2014). Entrepreneurial marketing. Pearson Education.
Massa, L., & Tucci, C. L. (2013). Business model innovation. The Oxford Handbook of Innovation Management, Oxford University Press, Oxford, 420-441. DOI: 10.1093/oxfordhb/9780199694945.001.0001
Sinkovics, N., Sinkovics, R. R., &Yamin, M. (2014). The role of social value creation in business model formulation at the bottom of the pyramid–implications for MNEs?. International Business Review, 23(4), 692-707. DOI: https://doi.org/10.1016/j.ibusrev.2013.12.004
Zott, C., Amit, R., & Massa, L. (2011, July). The Business Model: Recent Developments and Future Research. Journal of Management, 37(4), 1019-104. DOI: 10.1177/0149206311406265