A Study On The Enterprise Profit Model Based Upon Value Chain Theory

Profit is the key point of the operation and the driving force for the development of enterprises.With the rapid growth of economic,competition between enterprises has become increasingly fierce.Winning profits only by the expansion of market share is no longer effective because of the limited market size and a large number of competitors.Enterprises must explore a unique business pattern that is suitable and helps to achieve value growth in the fierce competition.It requires the establishment of a profit model by the core competitive advantages of enterprises to meet customer needs.However,at present,the research of profit model has just started,and mostly be confined to some specific industries.It has not formed a unified theoretical framework.Therefore this paper will establish a more complete framework in a new theoretical perspective based on summarizing and researching the existing study.The purpose of profit model is to increase enterprise value through customer value and corporate profit growth,which can be achieved by the function of the value chain.Therefore,analyzing profit models based on the value chain theory reflects the basis and ultimate goal of profit model designing.In this paper,through the optimization and integration of internal value chain,competitor value chain and industrial value chain,we innovatively propose five types of profit models based on the theory of the value chain and the core of profit model innovation:vertical extension of the value chain model,horizontal extension of the value chain model, expansion of the value chain model,contraction of the value chain model and virtual value chain model.And then we analyze the motivation,implementation approach and risk resistance mechanisms of each model.By evaluation the profitability, growth capacity,operating capacity,risk resistance of the enterprise application cases,we can conclude that whether the specific profit model is suitable for a given enterprise and it has taken the advantages of integration.We also suggest the improved methods and the direction of future development through comparative and trend analysis.Therefore,the design of the profit model is not only the process of value chain optimization and organizational innovation,but also a dynamic adjustment of the system.In this paper,we explore the pattern,motivation and risk of innovative profit model from the perspective of the value chain.We hope that the general rules of the particular profit model cases can play a guiding role in the strategy management of enterprises.