CheckPoint: Business Models and Systems Resource: Ch. 1 & 2 of Introduction to Business Due Date: Day 5 [post to the Individual forum] Consider a local business whose services you frequently use. What are the main components of this company's business model? Using Figure 1.2 on p. 11 of your text as a guide, describe the three components of the business system that comprise the local business you selected. Your response should be 200-300 words in length.

Conoco Fuel Station and Garage
Business Commerce – The fuel station provides fuel and lubricants from outside pumps that can be accessed 24hrs per day. The outside pumps have pay at the pump to reduce personnel overhead and add convenience for people in a hurry or customers can go inside where drinks, snacks, and magazines are available for purchase. The fuel for vehicles is always in high demand because people rely on their vehicles to transport them from their homes to work, grocery store, and other locations on a daily bases. The demand for fuel stays on a consistent basis and has the supply of fuel oil diminishes the price for a gallon of fuel rises in price. The high demand and lower fuel supply has raised the price of fuel to an all-time high creating a consistently changing market price for the fuel and lubricants. All these products are purchased using cash, check, and credit card. The fuel station makes more of a profit on fuel when fuel prices are low because of the higher demand for the fuel. When fuel prices are high the fuel station makes less of a profit because of the higher cost of the supply creates less demand. The Conoco increases its profitability by investing in mechanics and tools to work on vehicles.
Business Occupation – The Conoco garage has trained mechanics with experience to diagnose problems with a vehicle and the ability to fix them at a reasonable cost. They specialize only in minor repairs such as oil changes, new tires, fixing leaks, and other minor repair to the vehicles. These skills and abilities are an asset to the business and help to attract future customers. Specializing in only minor repairs allows them to keep a low overhead by possessing only a few mechanics that are crossed trained in all minor repairs of vehicles and allows them to carry fewer parts and smaller quantities of each item in the company’s inventory. Each repair can usually be done in one to two hours allowing the garage to process several customers in a normal eight hour day. This is a big advantage over their competition because it provides the Conoco Station with the ability to provide faster customer service and take care of more customers on a daily bases. The Station has developed a reputation over the years and has reinvested properly in the business with updated machines and tools to increase productivity and a waiting room with a customer service person to ensure that each customer has complete satisfaction with his or her service. The combination of minor repair skills, fast service, low overhead and friendly atmosphere have created a profitable business over time that will continue to produce
Business Organization - The Conoco Station and Garage have several transaction cost because they are a smaller business some of the transaction cost will be hirer than others. The station will have to spend a several hours negotiating prices for auto parts that they carry a stock of for their customers such as tires, filters, oil, and windshield wiper blades. To save on transaction cost for other auto parts the garage picks them up at the local auto parts store. The auto parts store has a larger buying power that allows them to purchase some parts cheaper than the garage. Another transaction cost is the teamwork that has come together to ensure repairs and service are done correctly and in a timely fashion. The mechanics have to communicate on each vehicle repairs so each individual understands his or her responsibility. From the person who changes the oil to the person who changes the tire. All the mechanics must communicate to the casher the completion of the work that was done and the cost of each repair in order for the cashier properly to charge each customer his or her bill. This is important part of the business and must be monitored very closely to help prevent any fraud. The owner must ensure that all repairs are being done correctly on each vehicle and all completed work is billed correctly. Inventory must be monitored to prevent theft and missed billed items throughout the entire station. The station has worked to lower transaction cost by providing an organized structure of mechanics that can clearly communicate daily goals and information that provide good teamwork towards a common goal.