Figure 2
The diagram is composed of four rounded text boxes connected by circular arrows to illustrate relationships among components of a business model. At the top, a large box titled “Customer Value Proposition (C V P)” lists three sections. Under “Job to be done”, it states: Everyday value (Reputation for low price and high value). Under “Value for money”, the bullets include (plus symbol) choice, (plus symbol) convenience, and (plus symbol) product innovation. Under “Offering”, the bullets list (plus symbol) Proximity format (Small and medium format), (plus symbol) Service (Fresh department), (plus symbol) Personalization (contact sales personnel), and (plus symbol) Brand assortment strategy (N B M s, E P P Ls, P P Ls). A small blue label “V Cr” appears on the lower right side of this box. Below and centered is a second box titled “Profit Formula (Innovation and price index)”. It includes a “Revenue and margin model” and lists: 50 percent N B Ms, 50 percent E P P Ls and P P Ls, (plus symbol) Revenues, (plus symbol) Average margins. A “Cost structure (low fixed and variable costs)” section follows with multiple negative-cost bullets: (minus symbol) Marketing costs, (minus symbol) Logistics costs, (minus symbol) Purchasing costs, (minus symbol) H R costs, (minus symbol) Assortment costs, (minus symbol) Warehouse costs. The final bullet reads High resource velocity. A small label “V C a” appears near the bottom right of this box. On the lower left, a third rounded box titled “Key Resources” includes three bullet groups: Strategic partnerships (example, Purchasing centres; N B Ms partnerships), Private labels and brand assortment, and Small and medium format (stores). A small label “V Ca slash V Cr” is positioned at the bottom of this box. On the lower right, a fourth box titled “Key Processes” lists: Data Analytics (Customer knowledge management), Product range rationalization, Product range innovation, and Managerial process simplification. A small label “V Ca slash V Cr” is shown near the bottom edge. Double sided arrows connect lower three boxes, and the upper box in a circular flow: C V P at the top links downward to the Profit Formula; the Profit Formula links to both Key Resources and Key Processes; and Key Resources and Key Processes feed back upward into CVP. A pale circular outline behind the boxes reinforces the loop structure.Extended representation of the Italian EDLP-RBM. VCr = Value creation; Vca = Value capture. Source: Authors’ adaptation from Johnson et al. (2008)