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14. November 2014

The origins of the term 'business model'

"It is the customer who determines what a business is.  It is the customer alone whose willingness to pay for a good or service converts economic resources into wealth, things into goods. What the business thinks it produces is not of first importance – especially not to the future of the business and to its success.
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What the customer thinks he/she is buying, what he/she considers value, is decisive – it determines what a business is, what it produces and whether it will prosper. And what the customer buys and considers value is never a product. It is always utility, that is, what a product or service does for him.
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The customer is the foundation of a business and keeps it in existence."
Peter Drucker, 1974



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