A business model is a kind of formal or informal framework that exists in an organization to create social, economic and other forms of value and intends to represent some strategic aspect of business like trading practices, operational processes, infrastructure establishment or other policies and practices.
Pyramid Business model is one such example of business model which comes in the category of non sustainable business model. It involves exchange of money amongst o people by enrolling them into the scheme. In such a process no product or service is delivered. This model is illegal in many countries.
8- Ball model is an off shoot of the pyramid business model. This is bit more sophisticated and intricate than the conventional pyramidal business model.
This model begins by initial assumption that enrolling a large number of people in the scheme can be quite a challenge. To overcome this challenge a special strategy is used that requires each person to recruit two others, who in their turn must recruit to others so on and so forth in order to earn money.
“Airplane Game” is one such popular instance of this business model. This has four tiers. Starting from the top, the first tier is that of a captain followed by the co-pilot, crew and the passenger tier. The captain was paid only when eight passengers arrive at the bottom of the pyramid.
Another instance of the pyramid was “the original dinner party”. The analogy here was made with the four courses of the meal. The four tiers were “the dessert", "main course", "side salad", and "appetizer" with “dessert" at the top of the tree. There have been other variants to this like “Treasure Traders”, in which terms from gemology were used to represent the four tiers.
The business model tried to down play its pyramid structure by calling itself a “gifting circle”, where money is gifted to other members. Scams like “Women empowering women” have euphemistically been tried to advance this model by luring women, the joiners of this scheme were told that "gifting" is a way to skirt around tax laws.
One unit of 8 pin model involves fifteen people (1+2+4+8=15). Each person at the bottom tier or the passenger contributes $1000 to join the pyramid. As soon as there are eight passengers, the captain leaves the pyramid by taking $8000. Now the pyramid splits into two with each co-pilot now becoming a captain of each individual pyramid.
During a wave of pyramid activity , many people join the scheme often after hearing the windfall of $8000 over a person ,but they often overlook the fact that if the scheme collapses early ,as large as eight percent of the people can stand to lose cent percent of their money.
Many such schemes have hit society from time to time and conned innocent people of their hard earned money. The government should henceforth educate the people about the mere shallowness and futility of such schemes so that people remain clear of such fraudulent schemes.
A business model is a framework that helps you understand your business better as well as acts as a tool to explain the concept to others. There are many realistic reasons as to why a good business model is needed and why you should get one for your company immediately. Business models have been in use for a quite some time now and with time they are becoming more and more advanced, organized and technological. This is because in today’s business world the market is so penetrated by others trying to get their products in the market. Another reason is the massive size of many of our corporations that go to other countries like China for business.
A business model in China (I will use China just so it’s easier to understand) is more than needed it is necessary, and not in just English but also in the Chinese language. It is necessary because when discussing business with foreign clients it is at the up most concern to get your idea across clearly and the best thing for that is to have a model.
So what does this model show? A business models main reason is to show how the business or product intends to make money or makes money, but it can also show you how a certain business is interconnected with clients, it can show revenues, it can show practically everything and anything related to a specific business.
Another reason a business model is needed is so that business’s can show how a business works to anyone, especially people in the Multi Level Marketing business. If you’ve ever tried an MLM business you have seen a business model. When they show you a triangular money scale, or any other type of scale, for that matter, they are showing you a business model which tells you how the money is earned.
The main goal of business model, after showing you how it makes money is to get you to be a part of the income opportunity. If it is a good one, it will interest the clients and impress them too, on many occasions. If it succeeds then it must have been good, and that’s why many large corporations are actively seeking new and better business models so that they can make new clients and prospects. Having a business model and showing it to potential business buyers or investors will greatly increase your chance at the business game of persuasion.
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