Business Model Canvas Application in Gaming Cafe

The assignment applies the Business Model Canvas (BMC) to a gaming cafe, analyzing its nine elements: customer segments, value proposition, channels, cost structure, revenue streams, key resources, key activities, key partners, and key customers. The BMC is used to understand the business model of the gaming cafe and identify potential opportunities for improvement.

ASSESSMENT

Table of Contents
BUSINESS CANVAS MODEL......................................................................................................1
Peer Group reflection.............................................................................................................4
Concept Improvement Reiteration.........................................................................................6
CONCLUSION................................................................................................................................9
REFERENCES..............................................................................................................................10

BUSINESS CANVAS MODEL
FUSION GAMING CAFE
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A gaming oriented theme base cafe business is proposed at initial stage. The idea behind
this venture is to provide a separate and single place to communities, people, youngsters. By
analysing the enhancing trend of online gaming and the networking huge scope of setting up a
cafe chain (Hong and Fauvel,2013). It is analysed that York house is one of the emerging
destination in terms of attracting online gaming users. Management committee decided to
establish the cafe nearby York House, London, England.
Key partners: This is divided in three categorise subject to above proposed business
plan. Suppliers category contains raw material suppliers for food and beverages. Distribution
partner’s category indicates towards partnership with software developers, gaming partners
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(Ubisoft and Gameloft) and server networks. Software partners as AMX software company,
Nvidea mother board and graphic card manufacturing company and Chrome partners. The
motivational factor is achievements of common goal by gaining more profit and returns while
working in partnership.
Key activities: Type of activities will be organised such as research and development
sections to improve new existing products and services, innovation and sections. Cafe
management, management of events and targets. Ambiance management and amenities variation
and theme based operations are the key values of the above business model. Coordination is the
the most important distribution channel for distribution channels, customer relations and
controlling of additional cost is the main revenue stream recognised under key activities.
Value proposition: This is one of the essential aspect in terms of making the sections
and variations among the value proposition and management sections (Joyce and Paquin, 2016).
The value proposition is evaluated in terms of managing the sections with creating the sections
and variations among the business ideas. Quality food service and environment friendly work
space was considered in this section. Lower and medium income group of customers will be
benefitted by delivering quality services.
Customer relationship: Feasible communication network and channels are required to
maintain ethical order within the organisation. A separate section for controlling the business
channels in terms of building networks and chains are to be introduced in structure. Cost format
will be remaining bifurcated as per quantity and service levels. Three formats will be provided to
customers as basic, class and plush.
Customer segment: Specific group of people is targeted such as youngsters, people
associated with gaming industry, software developers. Different payment sections are proposed
for customers such as online payment, net banking and internet banking. Young generation that
is engaging in activities of online surfing, gaming and mass communication are the important
customers.
Key resources: Type of key elements are required as IP centres are essential for
distribution channels, specific location to locate system is essential source for customers and
managing servers and taking licence and fulfilling legal requirements to getting extra earnings is
the main source subject to revenue stream.
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Advertisement channels: Sources of promotion such as social media feedback,
Instagram, radio channels, holding boards and you tube. Social media advertisement is the the
focused area subject to reach customers which is best in terms of cost. This cost is also mainly
associated with advertising. This is directly connected with individual customers and
Cost structure: The cost structure of cafe contains the cost of the raw material, payment
to suppliers of food materials and beverages, salaries to staff members, maintenance charge,
payment to software developers. It is expected that £50000 would be spent subject to set up the
image of business.
Revenue streams: Proceeds from selling spicy food, collection form subscription fees,
value chain, membership fees and content, collection from service charge, food and beverage
sales are considered in this section. It is expected that customers will pay for best ambiance and
service quality to business owners. There is an option of rental so will be provided Main source
of income will be generated from charging subscription fees, membership fees and collections
received form online computer gaming.
Peer Group reflection
The model which has been formulated for the new gaming café “Fusion” is presented in
front of the group. All the group members have identified various issues in this model. All of
them are related to the nine different factors of it. As the business idea is a new concept hence it
is very important to analyse all the issues and then form appropriate solutions for all the issues so
that a successful business can be established. When this model was shown to the peers then
following reviews or problematic issues are highlighted by them:
Number of suppliers is very low: One of the group member have provided feedback that
number of suppliers is very low and for a new business it is very important to have various
suppliers. It may help to buy material on low prices form different sources. This issue is required
to be resolved which may affect Fusion Gaming Café in future.
Need to enhance research activities: It is very important for a new business to have
appropriate knowledge and information of the market. By conducting a proper research such data
can be gathered that may help Fusion Gaming Café to involve some of the food items or drinks
that are going to be loved by the customers. According to one group member it is essential for
Fusion to get the right information regarding customer’s taste and preferences so that large
number of individuals can be attracted by the café (Massa and Tucci, 2012).
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In new businesses customers does not prefer to take membership: As there is a point
regarding membership is mentioned in business canvas model which is a problematic issue
because in new cafes customers are not interested to take membership. If Fusion is willing to
provide membership for free then it is very important for the café to render impressive services
to the visitors in order to enhance their interest. The group member has suggested that there is no
need of providing membership of a new business retain it for future when the café become
famous. At that time customers will be ready to pay higher amount for membership if effective
benefits are offered by the café.
As the business is new hence there is no regular customers: In Business canvas model
regular customers are mentioned under cross functional relations. When the idea is totally new
then it is not possible to have regular customers because the café is not yet being established.
The new idea is the part of food and beverage sector so the key resources would be
the food items: A new café related gaming theme is going to be established in London. The key
resources should be the food items but it is not mentioned in them. It is required to be mentioned
in the model so that it can be focused in order to successfully establish Fusion in the market.
There are end number of channels and it is not possible for the new business to invest
money in all of them: In channel various names are mentioned and for Fusion it is not possible
to invest money in all of them because for a new business it is impossible to spend higher
amount on advertisements and promotions. Social media is the best way for promotion as it is the
cheapest way to make customers aware of the concept of new business.
Cost of material for the food items is not mentioned in the cost structure: It is very
important to mention the cost of material to prepare food item in the cost structure as it will be
highest cost for the café. One of the group member has suggested to add this cost because it is
the main requirement of the Fusion Gaming Café.
Revenues can be enhanced by selling such food items that customers are willing to
have: A group member has analysed that revenue stream is very low for Fusion Gaming Café.
These can be enhanced by offering such food items to the customers that they are willing to
have. It will result in increased income and large number of customers for the café (Mentink,
2014).
For Fusion Gaming Café it is very important to overcome all the above described issues in
order to successfully establish the business in the market. If those changes are made in business
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canvas model, then it may help the form a detailed structure for new business. There are various
types of strategies that can be adopted in order to deal with above described issues. All of the are
as follows:
Making changes in the business processes: The problem can be resolved by making
changes in the processes so that possibility of mistakes can be reduced. This strategy is very
beneficial for the model because it can assure the success of new business such as Fusion
Gaming Café.
Continuous improvement: It is another strategy that can be adopted to resolve the issues
that are identified by the group members. According to this technique any type of problem can
be dealt easily if the business making improvements in its processes according to its needs.
Both the above described strategies may help to overcome the problematic situations that
are described by the group members.
Concept Improvement Reiteration
In order to implement new innovative business such as “Fusion gaming cafe” certain
problematic issues had been highlighted that could be the main reason for the reduction of profit
and productivity of company (Muhtaroglu and et.al., 2013). Therefore, it is very significant to
put forward the potential improvement strategies that will be beneficial to solve the highlighted
issues. Management of cafe must apply the process of continuous improvement model in order to
overcome the issues that are faced by them. This is sometime called as continual improvement
that is an on-going process of improvement in particular product and services produce and
offered by an organisation. It is a four step quality declaration procedure that includes (PDCA)
cycle also defined as Deming cycle or Shewhart cycle. PDCA stand for:
 Plan: Determine the opportunity and make effective plan for change
 Do: Implement the change on a small scale.
 Check: Using of data to examine the outcome of change and ascertain whether it is
useful or not.
 Act: If the modification was positive, implement it on a broader scale and endlessly
measure outcomes. In case if the change is not effective then begin the cycle over.
In Business canvas model of Fusion Gaming Cafe there are specific feedback that are
improved with the help of PDCA cycle such as
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Key partners: Different key partner who are subject to above proposed business plan.
Supplier’s category contains raw material suppliers for food and beverages. So as per the
feedback of customer supplier does not use to render service as per the customer taste
preferences (Rytkönen and Nenonen, 2014). So taking this feedback into consideration it can be
overcome by carrying out research analysis so as to get to known about customer taste and
preferences. Whereas distribution partner’s category indicates towards partnership with software
developers and server networks, so as per customer feedback the software that the fusing gaming
partner has adopted were not the update software, so this taking this feedback into consideration
manger of cafe can improve it but making use of modern and updated software. Thus, the cafe
can achieve its common goal by gaining more profit and returns while working in partnership
and by taking feedback of customers seriously and by working on it in order to improve the
service they render.
Key activities: Type of activities that were being carried out while operating cafe are like
research and development sections to improve new existing products and services, innovation
and sections. So as per the feedback research were not proved to be up to mark, thus in order to
improve the quality of product and services and to attract more customer, management of cafe
must carry out research analyse taking into consideration competitors strategy so that an analysis
can be made and accordingly need to produce products and accordingly price of products and
services need to implemented.
Value proposition: In order to improve the issues and feedback of lower and medium
income group people manager of café should implement effective methods such as online
delivering of foods items. With the process of PDCA cycle manager first make plans to relate to
improvement of quality of product, then they perform the following plan to few customers. In
case if they are satisfied with services than online booking portal will be opened for everyone.
This will be helpful in adding value proportion to the Fusion Gaming café.
Customer relationship: This is one of the essential aspects as is evaluated in terms of
managing the sections with creating the sections and variations among the business ideas. Thus,
as per the feedback value proposition rendered by cafe were not clear and up to the mark as well
as were not sufficient enough for the customer to take decision whether to take the services of
cafe or not. So taking this feedback into consideration management of cafe must create a winning
value preposition and it can be created only if the product and services specifies about what it is,
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for whom it is and how it is useful. Moreover, best value preposition will also help in
communicating the customers about the concrete result that they will get from after making
purchase and using of products and services.
Customer segment: Specific group of people is targeted such as youngsters; people
associated with gaming industry, software developers. But as per feedback of customer
management of cafe must target people of different age group as well like they should also target
small age group children as mostly in modern era children like to play online gaming rather than
any kind of outdoor games. Thus, it will help the management of cafe to gain more of
competitive advantage as well as it will help in increasing its revenue also. Addiction in the
games can be best option in the market as compare to other sports events. Thus, as a new
business it is vital for an organisation to make use of latest games that can attract the customer
toward their business more perfectly.
Key resources: There are certain issues related to resources such as location issues,
software update etc. that could be resolved by updating software so that game can be controlled
in better manner.
Advertisement channels: Sources of promotion such as social media feedback,
Instagram, radio channels, holding boards and you tube. However, as per customer feedback
management of cafe must also target small age group children so in that case management must
make best use of TV to advertise about their products and services, as mostly children prefer to
watch TV after coming from school. Moreover, advertisement should be given on cartoon
channel, as children prefer more to watch cartoons than any other aspects. Thus, it will help
management to increase their productivity and profitability ratio as well. As this company is
start-up business because of which there is lack of resources hence, it is not possible for the
company to invest on expensive promotional channel. Therefore, pamphlets can be the
appropriate advertisement mode as promotional tool as it is less expensive.
Cost structure: in order to overcome the issues related to cost structure of café
management must make advance budgets so that cost can be controlled and profit can be
increased. The cost erection of cafe covers the cost of the raw measurable; expense related to
suppliers of food etc. thus effective plan could be made to control the following expenses. In
case the company is offering free internet and Wifi facilities then the technological cost will get
increased which was not mentioned earlier.
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Revenue streams: With the support of PDCA cycle manager of gaming café could add
option of providing room for rent that will have provided main source of income. As it will be
produced from accusing subscription charges, association fees and gatherings expected form
online laptop gaming.
Modified canvas model:
CONCLUSION
From the above report, it has been concluded that business canvas model is a significant tool
that help in launching new business into market. There are mainly nine elements of BMC model
that need to be determined and analysed for better result.
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REFERENCES
Books and Journals:
Hong, Y. C. and Fauvel, C., 2013. Criticisms, variations and experiences with business model
canvas.
Joyce, A. and Paquin, R. L., 2016. The triple layered business model canvas: A tool to design
more sustainable business models. Journal of Cleaner Production. 135. pp.1474-1486.
Massa, L. and Tucci, C. L., 2013. Business model innovation. The Oxford handbook of
innovation management. 20(18). pp.420-441.
Meertens, L.O. and et.al., 2012, March. Mapping the business model canvas to ArchiMate.
In Proceedings of the 27th annual ACM symposium on applied computing (pp. 1694-
1701). ACM.
Mentink, B., 2014. Circular business model innovation: a process framework and a tool for
business model innovation in a circular economy.
Muhtaroglu, F.C.P. and et.al., 2013, October. Business model canvas perspective on big data
applications. In Big Data, 2013 IEEE International Conference on (pp. 32-37). IEEE.
Rytkönen, E. and Nenonen, S., 2014. The Business Model Canvas in university campus
management. Intelligent Buildings International. 6(3). pp.138-154.
Trimi, S. and Berbegal-Mirabent, J., 2012. Business model innovation in
entrepreneurship. International Entrepreneurship and Management Journal. 8(4). pp.449-465.
Wallin, J., Chirumalla, K. and Thompson, A., 2013. Developing PSS concepts from traditional
product sales situation: the use of business model canvas. In Product-Service
Integration for Sustainable Solutions (pp. 263-274). Springer, Berlin, Heidelberg.
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