BUSINESS MODEL CANVAS
- KEY PARTNERS
ENCYTE is an online retail shopping website, which focuses on selling technological products such as electronics, computers and mobile phones. We do not manufacture any product, thus, all products being offered for sale to the public via our website are all directly acquired from all our key partners, who are the manufacturers and suppliers of all our technological products.
Our company acts as a Consignee under the Consignment Contract with all our trusted suppliers. The suppliers retain ownership of all the goods held at hand until it is sold out from the website. ENCYTE decided to resell only and not manufacture its own products as this will minimize capital and expenditure; risks involved in developing a product; saves time in materializing the business; and can offer a more diverse range of products.
To sum up the key partners:
1. ENCYTE – the online retailer
2. Product Suppliers:
Suppliers for TVs: Akai, Bush, GVA, Hisense, LG, Panasonic, Samsung, Sharp, Sony, Strong Technology, TCL, Teac, Topfield
Suppliers for Audio products: Apple, Beats, Bush, GVA, Jabra, JBL, LG, Lenoxx, Logitech, Magic Box, Meeco, Panasonic, PARROT, Philips, POLKAUDIO, Sangean, Samsung, Sennheiser, Sony, Syntec, Teac, Yamaha
Suppliers for TV & Audio Accessories: Apple, Belkin, Broostone, Crest, C R Kennedy, Cygnett, Energizer, Eveready, GVA, Hisense, Lenoxx, LG, Logitech, Moshi, NITEIZE, One for All, Panasonic, Proserie, Samsung, Sony, TDJ,Viali, Yamaha
Suppliers for Desktops and Laptops: Acer, Apple, Asus, Hewlett Packard, Samsung
Suppliers for Gadgets & Tablets: Acer, Administration, Amicroe, Apple, Asus, Belkin, Bidulanco, Cellnet, Cygnett, Gecko, Griffin, GVA, Hewlett Packard, Kobo, LG, Logitech, MEC, OTTERBOX, Samsung, Shroom, Sirix Digital, Sony, Targus, Thule, Toshiba, Vivitar, ZAGG
Suppliers for Computer Accessories: Belkin, Brother, Canon, Crest, Epson, Fellowes, Fuji Xerox, GVA, Hewlett Packard, Ilford, LUXOR, Pico, Samsung, Thor Technologies
Suppliers for Smart Phones: Alcatel, Apple, HTC, Huawei, LG, Motorola, Nokia, Samsung, Sony, Telstra
Suppliers for Mobile Accessories: Apple, Belkin, CASEMATE, CLEANRAN, Cygnett, Flex, GVA, HTC, Jabra, LIFEPRO, LUXOR, Motorola, Samsung, STM, Telstra
3. VISA/Mastercard/American Express/Paypal – online payment platform
4. Knight Frank Australia – Melbourne – property manager for the lease of the distribution centre of ENCYTE
5. Australia Post – contracted courier to deliver products ordered from ENCYTE
6. GE Capital Finance – finance provider for ENCYTE customers
7. ENCYTE Solutions – installation service provider for ENCYTE customers
- KEY ACTIVITIES
The key activities expected from ENCYTE are to centrally create sales; administer, and manage all customer accounts; website maintenance and troubleshooting; manage ordering across SKUs to all product suppliers; view order and invoice history from all partners; handle billing of the company; and directly manage support cases with customers to strengthen customer relationships. On the other hand, all product suppliers are expected to provide sales, marketing and deployment training, for both technical and non-technical roles as well as to efficiently and effectively supply the products to our company.
In regards to our online payment partners, they are expected to process all payments promptly and properly from all orders made via ENCYTE in a secure manner.
Knight Frank Australia – Melbourne, being the property manager for the ENCYTE Distribution Centre, is also expected to properly maintain the whole of the facility.
With our in-house finance, GE Capital Finance, we expect a timely response from them in regards with all finance applications made by our customers, in order to secure sales for ENCYTE. With Australia Post, they are expected to provide a safe and timely manner of delivering all products ordered from us to all our local customers.
ENCYTE Solutions, being an independent department of ENCYTE Pty Ltd, is expected to provide professional installation services for all our electronic products for a fee payable by the customers.
- KEY RESOURCES
All technological products being marketed in our website are the main key resources, as our business revenue will be generated through the sales of these products. Contracts signed with our various key partners play an important key resource as well, as these contracts made it possible for ENCYTE to market their products on our website and avail their services. Capital and manpower invested in setting up and running the company are both vital key component to our resources too.
- VALUE PROPOSITIONS
To sum up the value that we are delivering our customers is enlisted below:
- Offering technological products with the most current, innovative, beneficial, stylish, and diverse in functionality.
- Trusted products as it is acquired from major brands.
- Providing continued customer support and solutions in terms of mobile management and other customer service matters.
- Reasonable and affordable pricing as our company eliminated some capital expenditure.
- Accessibility and convenience as the platform used in marketing the product is online based.
- Trusted partners in delivering services and products to our customers
- CUSTOMER RELATIONSHIPS
- Personal assistance - for those orders who are picked up by customers at the Distribution centre; e-mail, phone support, and contact form via website are also available for all customer queries.
- Self-service - as we try to make a good customer shopping experience through the ease of using our online self-service check-out.
- Automated service - we directly send invoice to the customer’s supplied e-mail address after the confirmation of product order; an e-mail is also sent if the product is ready to be picked up at the Distribution centre; e-mail is also sent if the product is already collected for delivery from the Distribution centre; another e-mail is also sent after the delivery has been made to receive feedback in terms of the product purchased and service provided; in terms of marketing, e-mail is also sent for updates and news, e.g. discount currently being offered in our website.
- Communities - Facebook and Twitter pages are also available to update all our customers regarding the latest products, news and trends, current deals, and such.
- CHANNELS
ENCYTE provided a number of ways or channels for customers to interact with the company, and vice versa. In terms of marketing, we send an automated e-mail regarding our promotions and updates with our latest products and news online, to all our valued customers who agreed to be contacted via this channel. ENCYTE’s Facebook page and Twitter account will be updated regularly. This will help our customers raise awareness about the business’ products and services.
To help our business evaluate customers’ satisfaction regarding the product/s purchased and service/s provided, a feedback questionnaire is sent automatically upon receipt of product, via e-mail to the customer. Upon completion of purchase on the website, customer can also rate their shopping experience on a scale of five (5). Data collected from these channels will be used to help identify areas that need improvement.
We use internet as mainly our platform in reaching our customers as it is time and cost effective. We also believe that online is the most suited channel to do all our transactions as most customers have access and find it convenient for them.
In the formulation of the ENCYTE website, we consider two main factors – ease with navigation and informative approach. We chose a simple layout for the website that will make it easy for the customer to navigate and search product/s they wish to purchase. There is designated tab for each category that directly gives the customer the product listing for that said category. In regards with finalizing the purchase, we chose a “one-step check-out system,” to save time and provide an easy check-out, eliminating unnecessary steps and details. In this system, a customer may wish to check-out as a guest customer or as a registered user, so they can store their details.
As we also encourage smart-buying decision, we aim to provide “buying guides” for every technological product we market in our website. All products purchased via our website are delivered through Australia Post. We charge a fixed pricing delivery for all small items and bulky items, respectively. No extra surcharge applies nationwide.
After product delivery has been made, if for any reason a customer wishes to contact the company, we have provided a contact form on the website where customer can enlist all their queries. Company switchboard number is also indicated on the website, for customers to directly contact us and speak to one of our representatives. Company postal address and customer service e-mail address are also provided, if ever a customer chooses to contact us in writing.
- CUSTOMER SEGMENTS
As ENCYTE markets a diverse range of products, it is therefore catered to the general public. Although some certain subset will find it more beneficial to shop online, e.g. buyers with time and/or physical restrictions, we welcome all online shoppers from all backgrounds.
- COST STRUCTURE
With ENCYTE being a Consignee and an online business, we were able to eliminate costly capital expenditure, e.g. product inventory (suppliers are paid after sale has been made); store lease; salaries for retail staff. Below is our business cost structure:
- Fixed costs:
1. Annual lease for the ENCYTE Distribution Centre
2. Salaries of administrative and warehousing staff – most expensive key resource (manpower)
3. Utilities expenses
4. Courier service fee
5. Insurance
6. Transactional fees
- REVENUE STREAMS
The main source of income for ENCYTE is through sale of products (Product Sale Stream). Products were all directly acquired from the suppliers at wholesale prices and were then directly sold to the public at a reasonable sale price. We pride ourselves in providing products at a more reasonable and affordable prices for which customers are willing to pay for. Our product line are priced at a lower price compared to products sold at the stores, as we have lesser overhead expenses being an online store and does not pay any lease for physical stores. Once a customer places an order online, he/she has an option to pay by credit card or Paypal. If a customer wishes to pay other than what is available online, he/she can contact us to make an arrangement on ways to make payment. Delivery of product ordered is only done after confirmation of payment made. The revenue generated from this stream will be based on the fixed pricing of all products on the list price. This revenue stream makes up for 70% of our overall business revenue.
Another source of income for ENCYTE is through advertising (Ad revenue stream) made by various companies. There are two ways of generating income under this category – (1) through subscription fees; and (2) cost-per-click (CPC).
Companies pay a subscription fee to us, for us to advertise their company as a whole; or a specific product/service; or line of products; or services. They have an option to subscribe on a monthly, quarterly, half or annual basis. Ads will appear as a banner to our website or as a sponsored link on the website. Fee charges will be determined based on the length of subscription and content. When the specifics of the ads have been finalized, an invoice will then be sent to the company. Once payment of subscription fee has been confirmed, their ad will now be published in ENCYTE. The revenue generated from this stream will be based on the fixed pricing of the fee charges of the subscription but total fee charges will vary depending on the options nominated. This revenue stream makes up for 15% of our overall business revenue.
In regards to the cost-per-click revenue stream, our company gets paid for every hit recorded against the ads on our website. This is currently charged at $0.01 per click. An invoice will be sent to the companies on a monthly basis, detailing the traffic and the total charges associated. Available ads on the website for viewing are reliant on their subscription terms. The revenue generated from this stream will be based on the fixed pricing of the cost per click against the hits recorded. This revenue stream makes up for 5% of our overall business revenue.
Another source of income for ENCYTE is through affiliate program (Affiliate sale stream), in which we get commissions for product sales made through our website endorsement. The revenue generated from this stream will be based on a fixed percentage agreed by us and our associates against the product list price. This revenue stream makes up for 10% of our overall business revenue.