Research On Profit Model Of Commercial Banks

In recent years, with the development of study of business model, a related research field called profit model has been developing gradually. As a new analyzing unit, profit model makes enterprises have a more systematic view of their operating conditions. It also helps enterprises think about and analyze their operating processes, and make correct decisions based on self-cognition and understanding of new marketing conditions and competition environment. In my opinion, profit model is essentially a mechanism that enterprises make the value of their products or services realized, and maintain long-term, stable profit, through the integration of all aspects of business relations and improving production operation. The commercial banks have become more and more mature during more years of development. In order to make profit steadily and continually to realize continual development, commercial banks have to improve their profit model continually.In my opinion, the profit model of commercial banks includes four elements: internal value chain, target market, profit path and relationship network. The value chain has an important effect on commercial banks' profit model. In selecting of the profit models, commercial banks should consider the characteristics of the industry and value chain. Target market is that commercial banks provide value to. According to the characteristics of customers, the market can be divided into individual customers and enterprise customers. Commercial banks can hold more market share, by analyzing the factors of customers' selection and taking measures according to the factors. Profit path is essentially the routing and connecting that enterprises receive profit. It connects the enterprises and target market, which includes the information, products, services and funds, and reflects the flow of such information. Commercial banks can learn the profit path by production and price. The production of commercial banks is essentially service, poor confidentiality makes it easy to imitate, so commercial banks must keep the ability of innovating. Price is the process that the value of the production turns to income, it is very important. Business relationships can be described as action of participants or actors, including competitors, suppliers, customers, distributors and government, which affect each other. For commercial banks, the relationship network includes competitors, customers and the Government.Based on the studying of four elements of commercial banks' profit models, we can reach the model of the commercial banks' profit models. The model covers internal and external elements. Internal elements involve Outsourcing and Business Process Reengineering; external elements involve target market, production, price, customer alliance, competitors and government. Commercial banks must consider all the elements to improve their profit models.