Analyzing the Business Model of McGrath: A Critical Review

Running head: THINK BIG
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Executive Summary
This is a report which has critically analysed the business model of the organization
McGrath. The nine components of the business canvas model has been analysed to identify
the key partners, key resources, key activities, customer relationships, channels, customer
segments, cost structure and revenue streams of the organization. The analysis revealed that
the organization has been using the high touch business model that is dependent on the
relationship between the consumers and the organization. The report has provided the
interrelationships, downside risks, business model changes and the recommendation for
McGrath.

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Table of Contents
I. Introduction.............................................................................................................................3
II. Business Model.....................................................................................................................3
A. Building Blocks.................................................................................................................3
1. Customer segments........................................................................................................3
2. Key partners...................................................................................................................4
3. Value proposition...........................................................................................................5
4. Key activities..................................................................................................................5
5. Channels.........................................................................................................................5
6. Revenue Streams............................................................................................................5
7. Cost structure.................................................................................................................6
8. Key resources.................................................................................................................7
9. Customer relationships...................................................................................................7
B. Interrelationships...............................................................................................................8
C. Critical Success Factors.....................................................................................................8
E. Business Model Changes...................................................................................................9
III. Conclusion........................................................................................................................9
IV Recommendation..............................................................................................................9
References................................................................................................................................10
Appendix..................................................................................................................................11

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I. Introduction
McGrath is one of the most successful and prestigious housing real estate
organizations. The organization commenced in the year of 1988 in Paddington, Sydney. The
organization operates on the east coast of Australia and consists of more than 94 offices
(Mcgrath.com.au, 2018). McGrath has developed a real estate integrated with the service
provided. The organization has their expertise in career training, auction services, mortgage
broking, property management and residential property sales. The organization has been able
to establish their presence strongly in markets such as QLD, ACT and NSW
(Mcgrath.com.au, 2018). However, the organization had been making their expansion into
other states such as Victoria.
II. Business Model
McGrath uses the high touch business model where they aim to interact with the
consumers as much as possible (Saebi & Foss, 2015). The overall revenue generation of the
organization is dependent on the relationship between the consumers and the salesperson.
Therefore, credibility, trust and transparency are key features of this business model.
A. Building Blocks
1. Customer segments
The majority of the consumer segments for the companies are the immigrants from
Asia where China and India are the biggest target audiences in the upcoming decade. The
native Australians are also the target audience due to the increase in development of the
suburbs and the main cities. The majority of the immigrants residents come from India which
around 40% of the total number of immigrants (Cdn.mcgrath.com.au, 2018). There has been
significant increase in the diversity of the population in the country and therefore, identifying
their preferences and needs and providing them with the best possible and suitable offerings
is the aim of the organization.