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Books and Articles by Jim Muehlhausen
Jim Muehlhausen is the founder and President of the Business Model Institute as well as consultant and speaker to businesses large and small. He is the author of The 51 Fatal Business Errors and How to Avoid Them and a frequent contributor to Entrepreneur, Businessweek, and dozens of other publications.
Articles & Books From Jim Muehlhausen
Cheat Sheet / Updated 03-27-2016
Designing or updating your business model becomes easier when you think through your offering, monetization, and sustainability. As you work on your business model, keep important tips in mind, ask questions to stay on track, and browse different pricing models to determine what's best for your business.
Article / Updated 03-26-2016
Pay attention to how many of your competitors have a similar unique selling proposition (USP). When Crest toothpaste first entered the market as the only cavity protection option, the USP was extremely powerful. Many competitors adopt what markets refer to as the “me too” strategy.
They put little time, money, or effort into identifying or developing niche markets.
Article / Updated 03-26-2016
The unique value proposition (UVP) extends the concept of the unique selling proposition (USP) to include the benefits derived by the customer. Customers ask themselves, “Are the unique features of this product worth the price?” Customers engage in this features–value weighing for all purchases. Augmenting your USP with a strong value proposition creates customers’ desires to trade their hard-earned dollars for your product.
Article / Updated 03-26-2016
The most profitable industrial product of all time is the Xerox copier. During the 1960s and 1970s, margins on the product were obscene. The copiers were so profitable that Xerox quickly determined that selling the copiers was a bad business model, because the entire cost of the copier could be paid off in a few months of rent.
Article / Updated 03-26-2016
The goal of any great business model is to have a high-profit product that customers want to buy. A highly marketable product is traditionally described as having a unique selling proposition. Whole Foods offers only healthy choices in its stores. Domino’s Pizza grew rapidly because of its super-fast delivery.
Article / Updated 03-26-2016
You don’t need a unique offering in order to have a business model. If, however, you want to have the most successful model possible, you want to offer customers something they can’t get somewhere else.
This uniqueness may be only one thing, such as the sole gas station on a particular corner, or it may be a combination of product and service features, such as those in a Lexus automobile.
Article / Updated 03-26-2016
Can you clearly and effectively explain your unique value proposition (UVP) in one sentence? It’s not always easy, but it’s absolutely necessary. If it takes a paragraph to explain why people should buy your product, a) they’ll tune you out after ten words and miss the important stuff, and b) your value proposition won’t be finely tuned enough to stand out in a crowded marketplace.
Article / Updated 03-26-2016
After you create a strong USP (unique selling proposition) and UVP (unique value proposition), you can assess the market potential of your product or service. Will you be filling an important unmet need in a multibillion dollar industry or simply babysitting for friends in your neighborhood?
Both of these examples are perfectly valid markets.
Article / Updated 03-26-2016
If you’re looking for the gold standard of margin innovation, look no further than the Minnesota Mining and Manufacturing Company (3M). Growing from a humble sandpaper manufacturer, 3M is now a Fortune 100 global powerhouse with 84,000 employees in 65 countries. 3M’s growth is a result of relentless innovation.
Article / Updated 03-26-2016
Generally, companies with better business models have superior margin versus their competition. This table shows the profit per vehicle for several automakers in 2010. Which business model do you think is superior?
Automakers’ Profit per Vehicle
Automaker
Profit Per Vehicle
Vehicles Sold
Profit (Millions)
Profit Per Vehicle Rank
Total Profit Rank
Daimler
$3,316
1,170,000
3,880
1
4
BMW
$3,000
1,224,280
3,673
2
5
Renault
$1,741
1,668,615
2,905
3
6
Nissan
$1,500
3,088,298
4,632
4
3
Ford
$1,320
4,320,792
5,703
5
1
VW
$1,288
4,407,062
5,676
6
1
Honda
$833
3,152,197
2,626
7
7
Hyundai
$810
2,931,325
2,374
8
8
GM
$553
2,202,927
1,218
9
10
Tata
$400
803,322
321
10
12
Toyota
$349
5,496,346
1,918
11
9
Fiat
$292
1,853,282
541
12
11
Mazda
$154
1,307,540
201
13
13
Chrysler
($438)
1,085,211
(475)
14
14
*Not all manufacturers listed.
