The fruit stand as a metaphorical business model

201601-unsplash-photo-1452804882841-573355623310-fruitBusiness can be complicated. When you think about large companies with international operations across tons of product lines, you find a lot of complexity. It helps to simplify things.

When I’m in that situation, I turn to the fruit stand. Almost all businesses can be described as a fruit stand, as long as you give yourself certain liberties. It’s not a perfect metaphor, but it’s been helpful to me much more often than not:

  • You have a simple product-based business? You have a fruit stand that sells apples and oranges.
  • You have a simple service-based business? You have a fruit stand where you teach people how to pick the best fruits, or how to make the best smoothies.
  • Your business targets different market segments? You have a fruit stand that sells apples and oranges (low end) and kiwi and mangos (high end).

You get the point. Mix and match to your heart’s delight.

You can use the fruit stand to think about your company’s cost structure. You might have to buy or lease the land on which you park your stand. You might have to buy or lease the stand itself. You might have multiple stands, in a franchise model. You might have to hire people to run your stand, or to liaise with fruit sellers. You of course have to buy the fruit itself.

You can also think about the costs of cleaning the stand, or storing excess inventory, or working with highly-trained chefs to engineer new smoothie recipes. The possibilities are endless.

One important part is keeping the metaphor simple. It’s not super helpful if you trade one kind of complexity for another. You want to remove some of the complexity when you reach for the fruit stand metaphor.

But you can build in some complexity as needed. Not everything needs to be super simple. The fruit stand metaphor gives you the flexibility to decide which complexity is essential. You can then retain that complexity in your metaphorical business.

Once you wrap your mind around a helpful fruit stand metaphor, you can map that metaphor back onto whatever real business you’re studying. It takes some care to build the right map, and to communicate your mental model with your boss, colleagues, or reports.

The more adept you become with building and communicating these mental models, the clearer you will communicate, and the more you will help the people around you.

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