Pattern Description
A full-service solution provider offers total coverage of products and services in a particular domain, consolidated via a single point of contact. This can prevent revenue loss by extending service and adding it to the product. Additionally, close contact with the customer offers great insight into customer habits and needs. This deeper knowledge can be used to improve products and services. A famous example is Apple's iTunes business model with its integration of hardware, software and content.
Fun fact
You may be sitting on a solution provider business model right now and not even know it. Lantal Textiles AG, dating to 1886 with its modern-day founding in 1951, designs, produces, and distributes textiles and services for aircraft, train, bus, and executive interior markets worldwide. The company's longevity is owed in part to its adoption of this business model in 1954 when it entered the aviation market.
Case study
CEMEX is a global building materials company that provides high quality products and reliable service to customers and communities around the world. It was founded in Mexico in 1906. When the company wanted to tackle the problem of affordable housing, it turned to BMI and came up with a solution provider plan. It would not only provide the physical product needed to construct a home, but also expertise and microfinancing. All in, an affordable home for a low-income family can cost just $10,000 thanks to its solution provider business model. Dozens of projects are now under construction in developing countries around the world.
Bonus
Check out our recent post about how another established company, long in the B2B game, came up with a B2C solution provider business model, unlocking major revenue potential.
