The next and final environmental forces block is “Macroeconomic Forces.” This section is used to determine if your business model can adjust to macroeconomic shifts. This is where keeping up with current events is important. In addition to watching the world and local news programs each day, I use an internet news aggregator that searches various news sources and delivers the daily headlines on a single web page. I generally reserve 1 to 2 hours every day to understanding the macroeconomic forces affecting my industries.
If you are short on time, the publication “The Week” is an excellent source that takes the world and national current events and boils them down to their raw essences in a weekly magazine that is available in print and online. Essentially when it comes to macroeconomic forces, we are looking at local, national, and world events that will affect our business model. As an example, I purchased a few properties in Gloucester County, VA a few years ago.
I made this purchase after a new bridge was built to connect the Middle Peninsula to the industrial hub located on the Virginia Peninsula. The Virginia Peninsula is the home of the industrial shipyards of Newport News and many government offices.
Prior to the new bridge, property on the Middle Peninsular was far less accessible to centers of employment which depressed property values. With the new bridge, property values rose on the Middle Peninsula at nearly 20% per year until an equilibrium was finally reached. By recognizing the effects that the bridge would have on local property values on the Middle Peninsula, I bought property early and made a lot of money that I would not have if had I not seen how local macroeconomic conditions would change property values.
In addition to current events, you need to assess how global, national, and local economic trends will affect your business model. For example, have you factored in how the slowing Chinese economy or oil prices will affect your business model? What about changing infrastructure? How did the interstate highways system affect the automobile industry? What if there were more charging stations for electric cars or a hyperloop coming to your city?
Finally, how might access to capital such as crowdfunding, or changing lending practices, or rising interest rates affect your business? What are the macroeconomic forces that will affect your Business Model Canvas?
There is also a FREE Podcast Series we offer on Applying the Business Model Canvas
