The Four Ways to Build a Business

Before we start choosing products, services, or building a brand, we need to answer one important question:

How are you actually going to make money?

There isn't just one way to build a business.

Different business models require different amounts of:

• Money
• Time
• Risk
• Skills
• Responsibility

For this course, we're going to focus on four main business models.

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1Physical product business

A Physical Product Business sells a real product to customers.

You might create the product yourself, buy it from a manufacturer or wholesaler, add your own branding, and then sell it for more than it costs you.

For example:

You could build a jewelry brand, buy products from a supplier, create your own packaging, and sell them through your store.

Main advantage

You usually have more control over:

• The product
• Branding
• Packaging
• Fulfillment
• Customer experience

Main trade-off

You usually need more money upfront.

If you're buying inventory before customers purchase, you're taking the risk that some of it may not sell.

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2Dropshipping / low-inventory business

With Dropshipping, you can sell physical products without purchasing large amounts of inventory before making sales.

A customer orders from you, and the supplier fulfills the order.

A similar option is starting with only a small amount of inventory while you test demand.

Main advantage

You can start with:

• Less money
• Less inventory
• Less financial risk
• Less storage responsibility

This can make it easier to test a product before making a bigger investment.

Main trade-off

You usually have less control over:

• Shipping
• Packaging
• Product quality
• Fulfillment
• Customer experience

Your supplier becomes an important part of your business.

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3Service / commission business

Instead of selling inventory, you make money by providing value.

You might:

• Perform a service
• Use a skill
• Build something for a customer
• Solve a problem
• Save someone time
• Connect a customer with a product or provider
• Earn a commission from a transaction

Examples could include:

Video editing, design, consulting, websites, photography, AI systems, local services, sourcing, or commission-based selling.

Main advantage

Many services can be started with very little money because you don't need to purchase inventory.

You can start by using:

Your skills + your time + useful tools

to solve a problem for someone else.

Main trade-off

You need to actually deliver the result you're selling.

Your time can also become a limitation unless you eventually improve your process through systems, automation, software, or other people.

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4Digital product business

A Digital Product Business sells something that can be delivered electronically.

For example:

• A course
• An ebook
• Templates
• A guide
• Software
• A toolkit
• A membership
• Another digital resource

You create the product and customers receive access digitally.

Main advantage

You don't need:

• Physical inventory
• Traditional shipping
• Storage

And once the product exists, you may be able to sell the same product to many customers without recreating it every time.

Main trade-off

Creating the product doesn't automatically mean people will buy it.

You still need to:

Create something valuable → Reach the right people → Build trust → Make sales

Marketing is especially important in this model.

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