For a business to stay sustainable it has to be profitable. The key to profitability is knowing what your customers want and giving it to them. You can only sell hype for so long before your customers catch on to you. A business which intends to last has to build a lot of value for its customers over long periods of time.

The internet has changed the game of business: One action can now have multiple effects bringing in revenue years after the action is passed. This is often called passive income but I call it the extended cash flow cycle. You can build a product today and with very little cost keep producing future revenue.

In building a business they are 3 major considerations you must reflect on namely:

Capacity: Using my current business model, what is the maximum amount of customers I can serve?

Revenue: Based on my capacity what is the maximum revenue I can earn?

Cost: How much must I spend to produce this revenue?

Your business model should address your capacity, revenue and costs and also how capacity is increased when customer demand increases. You are not going to make more than your business can handle. Moreover, the cost used to generate revenue should be less than the cost. With an internet model business, the cost is often a small portion of revenue when compared to its more traditional counterparts.

Capacity

Understanding your capacity, starts with first understanding the size of the market and what percentage of that market you will like to reach. Next, structure your business to handle the amount of predicted requests. For example, if your product is a downloadable product and you plan to reach 100,000 people per month then be sure to host your business on a server that can handle that much traffic. If you are a service based business, you will need enough people on staff to handle customer requests.

Revenue

Your capacity determines your revenue. In the beginning, revenue will be less than the capacity you can handle. Overtime, as people come to understand and appreciate the value you deliver, the demand for your product or service will increase past your capacity. You should have a plan on how to increase capacity if demand increases.

Costs

Your costs should be in line with the activities that generate revenue (you should have a good idea of all the activities that helps generates revenue in your business). Your pricing strategy should incorporate what it costs you to produce $1 in revenue based on your predicted capacity. Also be sure to charge for the habits you want to discourage.

In summary, building a sustainable business involves understanding your market and giving them what they want. The better you are at delivering value, the more successful you will become.