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Analysis of Spacer Business Model


Task: To be completed individually, you are required to prepare a business report that deconstructs an organisation's business model and identifies the critical success factors that make the business sustainable. Your analysis will demonstrate your critical thinking skills and your ability to professionally articulate your findings. Before commencing, you must seek your lecturer's approval to undertake an analysis of the business you have chosen.

The type of organisation that should be identified for study is one that is relatively new, innovative in how they operate, and have most likely been established in the last five years. To achieve a result that meets your study objectives, please ensure the business report addresses each of the assessment criteria detailed below and which is elaborated in the marking rubric.


The study is going to focus on the Spacer business model which they followed and identify the factors of success that has turned this into a sustainable business. The analysis of the Spacer business model will be based in relation to the Osterwalder and Pigneur’s canvass.

Description of the business
Spacer is a relatively new company, which provides space for rent for a temporary time duration. This company allows people to provide the extra space available in their home as rent. Spacer is an online marketplace, which works online for Self-Storage. It was established in 2015 and is a Sydney based company. The renting of extra space at home, provided people with a means of income, and the company acts as a mediator for the purpose. In 2017, Spacer acquired Roost Shared storage and its competitor Parkhound, two US-based company which were a similar online marketplace. Spacer further acquired its californian competitor Roost and widened its grip in Self-Storage market (Self Storage | Rent Space & Cheap Storage | Spacer, 2019).

The business model using Osterwalder & Pigneur canvas
The business model by osterwalder and Pigneur is used for planning and starting for a new business idea. These models forms the base of reference that is needed for understanding, designing, reworking and implementing of any new business models. These models form a useful tool, not only to plan new business, but also to change the orientation of an existing business in a new direction. The Spacer business model used can be compared with the models by Osterwalder and Pigneur (Täuscher & Abdelkafi, 2017). This business model can be mentioned in the form of nine blocks. These include:

  • Customer Segments (CS): This process requires the identification of the customers for the business and the reason for choosing of the product or services of the company in particular. This requires the identification of the types of customers and their demands. Spacer has aimed a complete database of its customers, and the probable customers that they can target with future services. The company generally segments its customers demographically and geographically, and works towards catering there needs.
  • Value Proposition (VP): This needs the identification of exact products/services provided by the organization, and the exact customer that the product/services target. It also deals with the identification of the problems that can be solved by the services provided by the company. Spacer, provides the opportunity to provide the extra space available in home, as rent. This not only provides the needed people with a place to reside, but also a means of income to the people who have spare space available in their home.
  • Channels (CH): This requires the identification of the way by which the product or the services generated by a company reach its customers. Spacer provides a virtual platform where the transaction and business deals with customers are dealt online.
  • Customer Relationship (CR): This requires the planning of ways to gain more and retain old customers. Spacer provide standardization of rates and take care of the smoothness and spontaneousness in the services provided, to retain its old customers, and even attract new ones.
  • Revenue Streams (RS): This process includes the identification of the sources of monetary input. Spacer has set up a fixed rate for the space provided for rent, based on the size and the quality of the space provided. Further, the tariff used by the app, also proves to be a major source of earning for the organization.
  • Key Resources (KR): This includes the identification of key resources for making the business work. This may include the identification of assets, or the need of people, finance, or customer lists. Spacer maintains a complete list of both customer section, the one that need the space and the one who wants to rent the space.
  • Key Activities (KA): This includes the identification of the major activities required to make the business work. This includes the identification of the important “to-do” for a particular business. Spacer has a well-formulated plan for running its business. This may include spontaneous service provision, standardization of rates and providing immediate help for customer support.
  • Key Partnership: This requires an assessment of the activities of partners, and the benefits acquired from the partners. Spacer has taken over many of its competitors like Parkhound and Roost, and the customers who previously used to increase the competition, now increases the profit of the company.
  • Cost Structure (CS): These are the fixed or the variable cost set by the company for its products or services provided. Spacer has a well-defined list of charges for the renting of different types of properties. In case of less availability, the company switches to variable costing method, where, the one who pays slightly higher price gets to use the services of the company.

Key interrelationship across the nine building blocks
Spacer sternly follows the nine building blocks, as mentioned in the model given by Osterwalder and Pigneur. Identification of the type of customers and segmenting it based on their types and needs or Customer Segmentation, is carefully done by Spacer. This helps to target the exact group of customers and meet their requirements specifically. Customer Segmentation also assists in finding out of Value proposition of Spacer, where they get a clear idea of the products and services generated by the company for its customers. Identification of the customer base and requirements makes it easy for the company to find the means by which its services channel to maximum number of users. This further helps in maintaining a proper Customer relationship, where the customer base helps to provide an idea for things to be done to retain them. This provides the idea for revenue generation. A well identified customer and a well planned services provides complete idea of the probable revenue generation. This also helps to identify the shortcomings and the things that are needed to be done for the business to prosper even more. This is identified as Key resources. These factors help to ascertain the Key Activities of a company and the probable benefit it will be having from its partners (Trimble, 2015). It will also help in providing a Cost Structure, where Spacer gets an idea of a legitimate fixed and variable cost.

Critical success factors to achieve sustainable success
Spacer business model that has provided it with huge success. It has a well defined system for identification of the customers and targeting their needs and provide the services that will be helpful for a large number of people. The space provided for rent, by the people provides the company to indulge in business with the need to provide and manage the space themselves. This promotes them to charge a nominal fees for intermediation. This has helped the company to restrict its prices to a very attractive and low value. This has helped to attract more and more customers. Further, an instant method of payment, has promoted a large number of owners to join Spacers. This has helped in increasing the business of the company many fold (Luthra, Garg & Haleem, 2016).

Factors that affect the success of business model
A proper customer base and a complete idea of the product and services required by them has helped Spacer to fulfill the demands of the customers and satisfy them. The service provided is spontaneous, standard and at a reasonable price. This has helped Spacer business model gain the loyalty of its customers. Further, the assessment of various sources of income and identification of shortcomings in the services provided provides the company a constant scope of improvement and thus helps to hold the trust of its customers (Aquilani, Silvestri, Ruggieri & Gatti, 2017).

Any necessary changes required
Following of the business model given by Osterwalder and pigneur has provided Spacer with huge success and growth. Still the complete process can still be improved to gain extra profit. Spacer business model has chosen online medium to deal with its customers. All the process including selection of space, booking and payment process is online. This has undoubtedly made all the process lucid and transparent. Although, the problem arises when either the customer is unable to access the online sources or the unavailability of network services. This problem can be solved by providing few counters for offline booking, which can compensate for the losses faced by the company owing to a problematic network or technical faults. This will provide the company with extra profit, and provide it with tactical advantage over the competitors.

It would be appropriate to mention the benefits of the business model provided by Osterwalder and Pigneur for establishment of new business or reorientation of old ones. Following this business model has helped Spacer to become a global giant. It has helped Spacer business model gain tactical advantage over its competitors and has provided it with an opportunity to gain more and more profit. Further, it was concluded that, providing offline counters for booking will help Spacer to gain further profit and loyalty of customers. Spacer business model assignments are being prepared by our management assignment help experts from top universities which let us to provide you a reliable academic assignment help online service.

Reference List
Aquilani, B., Silvestri, C., Ruggieri, A., & Gatti, C. (2017). A systematic literature review on total quality management critical success factors and the identification of new avenues of research. The TQM Journal, 29(1), 184-213.

Luthra, S., Garg, D., & Haleem, A. (2016). The impacts of critical success factors for implementing green supply chain management towards sustainability: an empirical investigation of Indian automobile industry. Journal of Cleaner Production, 121, 142-158.

Self Storage | Rent Space & Cheap Storage | Spacer. (2019). Retrieved 9 August 2019, from

Täuscher, K., & Abdelkafi, N. (2017). Visual tools for business model innovation: Recommendations from a cognitive perspective. Creativity and Innovation Management, 26(2), 160-174.

Trimble, C. S. (2015). More than a field trip: the business model canvas as support for field site visits in marketing courses. Change as a Constant, 92.

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