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Developing business ideas for drone technologies
Developing business ideas for drone technologies

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1.3 Key partners

Key partners are fundamental for every business model. Which activities are delivered by partners? Which resources are provided by partners? Which key resources can be acquired from partners? Which key activities do partners perform? These are key questions this block tries to answer.

Key partners

Key partners are the external companies, organisations or individuals that a business work with to create and deliver the value. There are several types of key partners.

  1. Strategic alliances involving non-competing companies. For example, agricultural research institutes are key strategic partners to drone spraying businesses for research and development collaboration.
  2. Competition characterised by strategic partnerships between competitors. For example, competing companies in the drone spraying industry might share anonymised crop data to improve overall spray accuracy and crop health analytics.
  3. Joint ventures established to foster the development of new businesses. A drone manufacturer and an agricultural service provider might form a joint venture to establish a dedicated company that focuses on the design, production, and service of drones specifically for spraying applications.
  4. Buyer–supplier relationships aimed at ensuring dependable suppliers. For example, drone spraying business partners with drone manufacturers.

Organisations form partnerships with the aim of enhancing their business models, reducing risks or securing resources. In the sustainable business model canvas, this is also known as motivation for partnerships.

  • Acquisition of particular resources and activities: it is rare that an organisation owns all the resources they need for their business. Therefore, obtaining certain resources and activities such as knowledge and licenses by partnering with other organisations would be beneficial for the business.

  • Optimisation and economy of scale: in designing a business model it is important to consider whether activities should be done internally or externally. This choice depends on several factors including economies of scales.

    An economy of scale arises if fixed costs remain constant as output increases, thus lowering the cost per unit of output. The concept is usually applied to explain the benefits arising from increasing the size of an organisation. For instance, a larger company can spread the fixed costs of its administrative staff or of its plant on more products than a smaller company. This means that the unit cost of the products for the larger company will be lower.

    Since economies of scales can be different across industries, it is then necessary to decide whether to do some activities internally or to enlist the help of partnerships and suppliers. In a drone spraying business, advanced drones and plant protection products are key resources. The production of plant protection products requires large plants and investing in an in-house production would not be efficient. Drone components are mostly developed by large companies, but their customisation can happen at a smaller scale.

  • Reduction of risk and uncertainty: partnerships could help to reduce risk and uncertainty in a competitive or new environment. For example, as the drone industry is in the introduction stage of the industry lifecycle, partnering with agricultural research institutions for research and development collaboration would enable the possibility of testing multiple technological solutions and spread the risk of failure across several partners. Uncertainty will also be reduced due to the sharing of knowledge and the development of capacity, which is one of the objectives of the ICAERUS project.