Business Model of Total Essay

1 IntroductionThere is no special and feature slogan used by transmit through its products. Total is using unalike slogans for their several kind of product lines in the countries, where they sale the products. Winners fill up with center is the slogan in Germany for the B2C segment for their filling stations.2 Company Profile TOTALThe former Compagnie francaise des ptroles, now TOTAL S.A., is founded on March 28th in 1924, together with its subsidiaries and affiliates. The history of TOTAL began in the Iraqi sands in the 1920s. TOTAL began its Upstream in the Middle due east in 1924. Over the past decades the party grew up, developed and expanded its presence throughout the world. Since 1999, the company has strengthened itself by merging with PetroFina and, at the beginning of 2000, with scalawag Aquitaine, so as to join the sm both club of oil and natural spoil majors. Today TOTAL is single of France largest corporations and the worlds fifth largest publicly-traded integ rated international oil and gas company.3 TOTAL is committed to meeting growing energy demand while consistently acting as a trustworthy corporate citizen.4 The company is registered in office 2, place Jean Miller, La Dfense 6, 92400 Courbevoie, France. Up to and including the fiscal year 2011, TOTAL, with all its subsidiaries and affiliates, employs 96.104 people.3 Business toughie Canvas applied by TOTALA assembly line mock up describes the rational of how an organization creates, delivers and captures value.5 The Business Model Canvas uses nine different perspectives, in order to portrait where the value of a company is created. It focuses on node segments, value propositions, distri exactlyion channels, customer relationships, revenue streams, pigment resources, key activities, key partnerships and cost structure.6 The following sections ar going to elaborate the theoretic basis of the Business Model Canvas and how it is practically applied by TOTAL.3.1 Customer Segments Customers are the heart of every business or commercial model. Therefore they are one of the most important stakeholders of a company and to have them is the basis urgency for an frugal venture. In order to be victorful on the market, products should be designed according to customers desires. Those necessarily can either be vulgar or rather specific. Customers should be segmented. This depends on different expectations towards profitability, distribution channel or especially the price. Those segments are also divided in groups like common needs, common behaviors or other characteristic features. Kinds of customers segments can be the mass market or the alcove market.7 As general definition customer segmentation is understand as the act of separating a group of clients into sets of similar individuals that are related from a marketing or demographic perspective. For example, a business that practices customer segmentation might group its current or potential customers accord ing to their gender, buying tendencies, age group and special interests.8 Due to the fact that TOTAL is a company in the sector of military group production, they are purchasing the strategy of customer segmentation to fulfill the different expectations at a best contingent rate. On account of the spheres of business TOTAL operates in the area of the mass market, if you would lay a focus on the petrol production. Therefore TOTAL is one of the biggest suppliers in the transportation sector. But the companys products are segmented by the different market segments.The business segment mainly focuses on 3 different branches upstream, downstream and the energy sector. These branches are divided as follows9 Upstream oil and gas transportation, development and production, liquefied natural gas Downstream refining, petrochemicals, specialization chemicals, marketing and the trading and shipping of crude oil and petroleum products Energy sector equity stakes in coal mines, operations in the power generation and renewable energy3.6 Key ResourcesDepending on the field of business companies need different resources. According to Canvas describes the component of the key resources the most economic verticals which are necessary for functioning a business model.26 According to Canvas TOTAL has the four from Osterwalder/Pigneur mentioned key resources. Physically, intellectually, humanly and financially. To bore after oil and gas and to produce fuel, lubricants and other goods from that, its necessary to have appropriate production plants and equipments.Because these are capital-intensive the financial resource arises from that. To open pools or to allow constructing new shoreward construction works the enterprise needs the necessary financial items. Among other things these were gained in the course of the companys history. Chemicals and special fluids, also the different fuels, need the humanly and intellectually resources. The mixture of all these four resources gi ves TOTAL the possibility to handle its operations in 150 countries. That theres a colony between the key resources is visibly with the fact that TOTAL invested 776 million for R&D in the year 2011. Its necessary to have a good combination between all key resources to get benefits of these investments.3.7 Key activitiesThe component of the key activities describes the most important things which an enterprise must do, so that its commercial model functions.27 In combination with key resources, key activities are responsible for creating unique products and services to carry out the value of the enterprise.The promotion of oil and gas, as wellhead as the production of fuels belongs definitely to the key activity of the company. Secondly a very important one is the know-how and the ability to create a functioning logistics cyberspace to operate through the countries all over the world with the different suppliers and customers.26 Osterwalder/Pigneur (2011) p.3827 Osterwalder/Pigne ur (2011) p.40103.8 Key partnersKey partners are the network of suppliers and partners who contribute to the success of the commercial model.28 First of all TOTAL endeavors to use local suppliers of goods and services as often as its possible. This action gluts to the local content programs. TOTAL stands for using local resources. Programs are aligned with the projects technical characteristics and local industry. Special key partners are not able to indentify. TOTAL mentioned by itself, that the company purchased 27 billion of goods and services from roughly 50,000 active suppliers worldwide.3.9 Cost structureThe cost structure describes all expenses which result by the accomplishment of a commercial model.29 This is the definition within the Canvas model. In general a cost structure is a method to determine how much it give cost a company to manufacture a product and how much profit will be recognized from manufacturing the product.30TOTAL has a mix of cost-driven and value-dr iven business model. Covered to the limited reserves of the fossil raw materials TOTAL invests millions of Euros into Research and Development. It is for developing unique and innovative products for helping to reduce energy consumption but also to find new resources of raw material like oil and gas or coal. Secondly a great part of the R&D portfolio goes to the sector of renewable energy like solar and photovoltaic. The biggest part of the Total expenses falls to the production of the several economic goods.4 ConclusionThe TOTALs business model is very effective. According to the several different economic goods TOTAL is producing, the customers are focused by creating value added processes that are fulfilling their basically needs along with a comprehensive growth of revenue. With production plants and service 28 Osterwalder/Pigneur (2011) p.4229 Osterwalder/Pigneur (2011) p.4430 http//businessdictionary.com/definition/cost-structure.html 11 stations in 150 countries, a sales of a bout 184,693 billion, purchasing goods & services of 27 billion from about 50,000 active suppliers worldwide TOTAL is the fifth biggest oil and gas production company of the world. In order to the growing markets in Asia, especially the Chinese market, TOTAL could be able to increase their sales because of the increasing energy consumption in this area. It is not easy to imagine, that they are able to enter new markets, because they are operating worldwide and satisfy the energy needs of the private and business customers all over the world. Taking into account of the dropping reserves of fossil fuels it becomes inevitably furthermore to engage very intensively in sector of the renewable energy.