Businessmodel of Newmont Mining

Customer Segments

Newmont has a niche market business model, with a specialized customer segment. The company targets its offerings at manufacturers in various industries that use metals in their products.

Value Proposition

Newmont offers one primary value proposition: brand/status.

The company has established a strong brand due to its success. It is one of the largest gold producers in the world, with gold reserves of 73.7 million ounces and an aggregate land position of approximately 20,000 square miles. It maintains operations and advanced development projects in seven countries on five continents. Lastly, it has won many honors, including the following:

• Ranking as the only gold company included in the *Fortune *500 and S&P 500 Index
• Recognition as the mining industry leader by the Dow Jones Sustainability World Index in 2015 and 2016
• Receipt of the 2012 Hardrock Mineral Community Outreach and Economic Security Award ### Channels

Newmont’s main channel is its direct sales team. The company promotes its offering through its website and social media pages.

Customer Relationships

Newmont’s customer relationship is primarily of a self-service nature. Customers utilize its products while having limited interaction with employees. The company’s website features a “Resources” section that includes fact sheets, brochures, reports, case studies, presentations, photos, and videos.

It also provides access to an e-mail newsletter that provides updates on financial news, performance reports, and upcoming events.

Key Activities

Newmont’s business model entails producing and distributing metals to its customers.

Key Partners

Newmont’s key partners are the suppliers that provide it with the equipment, materials, and services it needs to carry out its operations. They primarily provide the following:

• Bulk Commodities – Ammonium Nitrate & Explosives, Cyanide, Grinding Media, and Fuel & Lubricants
• Heavy Mining and Mobile Equipment – Drills, Surface Support Equipment, Shovels & Excavators, Trucks, Mobile Equipment, and OTR Tires ### Key Resources

Newmont’s main resources are its physical resources – its land and mines from which it draws its metals. The company also depends on its 28,000 employees, particularly contractors.

Cost Structure

Newmont has a cost-driven structure, aiming to minimize expenses through significant automation. Its biggest cost driver is likely cost of goods sold, a variable expense. Other major drivers are in the areas of sales/marketing and administration, both fixed costs.

Revenue Streams

Newmont has one revenue stream: revenues generated from sales of its products to customers.