Commercial Model - what is it?

[katy]

Hello, a software development company who will be developing the software for my website has ask me to give them information on my “commercial model and associated transaction costs (such as acquiring fees etc)”

Could any one enlighten me on what they are talking about and preferably with an example? Many thanks for your help.

[Alpha]

Initial comment is they should be explaining that to you in language that you understand. Did you ask them what they mean? If not you really should. You are(presumably) paying them to produce something that will be an integral part of your business and as such you should very comfortable in the working relationship. If you are not happy to ask them to explain anything and everything or they are not happy responding then find someone else!!

Anyway the commercial 'model'put simply is your vision of how you see your business interacting with your customers to take orders, supply the product/service and take the money!

It is a model because it doesnt physically do anything yet. As in a model you can play around with your ideas until you settle on something that you are happy with and then you put it into practice (A bit like building a prototype before developing the real thing)

[winton50]

Alpha's absolutely right.
Don't let any supplier intimidate you with big words and acronyms.

if they try it then simply say that you feel that 'you are not inhabiting the same emotional space' and will try elsewhere!

you are after all the customer

[Richard Conyard]

Explanations and long words out of the window - basically they just want to understand how they see your business running on the web so they can do their best for you.

It sounds like that phrase was put in there like a developer (we're not too fluffy). Day on day we generally have to deal with and understand umpteen 'commercial models', to try to get what we do turned into what you want it to do; sometimes we can forget to smile.

[winton50]

err... mistaken post sorry

[americatelefon.com]

Explanations and long words out of the window - basically they just want to understand how they see your business running on the web so they can do their best for you.

Well. That's right.
But next time the company you pay asks you something you don't understand, don't hesitate to ask them. It's their job to provide you with all information you need, cause they are paid for it.

[katy]

Thanks for your responses and advice. I phoned the company and asked them what a “commercial model” is. They told me to look it up on google, not very helpful. So I don’t think I’ll be dealing with that company any more.

Just out of interest could any one care to explain what a commercial model is and how it would apply to my business selling international calling cards over the internet?

Katy

[winton50]

Your 'Model' is the form your business takes.

So my 'Model' is a retail business selling mainly to retail customers through shop, phone and internet sales.

You can be as detailed as you like when explaining the model but what it really boils down to is how you do business as Richard explained above

So If they had said 'we need to know how you do business and how we can help you best' They probably wouldn't have sounded so clever but they would have got the work!

Incidentally I used to be a mechanic and we always said that no customer would have confidence in us if instead of telling them that they needed a new set of pistons, rings and gudgeon pins we said we had to fix the 'uppy downy things'

[Twokids]

Thanks for your responses and advice. I phoned the company and asked them what a “commercial model” is. They told me to look it up on google, not very helpful. So I don’t think I’ll be dealing with that company any more.

Katy

Katy! You got off lightly there! Good riddence to them!

It never fails to amaze me how companies can spend thousands ( sales and marketing) to get a customer and then throw them away with a stupid, insulting remark like 'look it up on Google'!!!

How would they feel if say, they needed an electrician and he asked them if they needed a Milliampdodah switch or a Donglewhatist switch for their house, they asked him what the difference was and he told them to look it up on Google...

Bloody hell - still I am all in favour of stupid companies throwing away customers - it means that I have a chance to pick them up!

Also I would love to know who they are - I would then speak to their MD and ask him/her if they realised what their staff were doing to customers - how there are thousands of SW developers out there, many are going bust and are desperate for work - and sell him an effective sales training package and offer a 3 month consultancy to sort out his staff problems before they go under too!!!

Good luck Katy!

Jim

[SmallBizSoftware]

Could've had some fun.

If asked for a commercial model, just tell them that you are looking for a 'blue sky' and don't wanna be restricted by 'thinking inside the box'.

Alternatively get them to 'benchmark the sector' and 'float' lots of options.

Could go on all day, but have to touch base with a bunch of techies who have issues on the back burner.

Graham
IT in plain English (http://www.smallbizsoftware.co.uk)