As a business owner, it’s important to have recurring revenue, and more than one stream of income. You shouldn’t just rely on one-off sales if you want to grow your business. This is unsustainable, and puts your business at great financial risk.
If you’re ready to overcome the typical feast or famine nature of freelancing, here’s some advice:
Instead of focusing all your energy on one-time sales, you should be thinking about how you can create recurring revenue for your company. Today, we’ll be talking about some business ideas you can start cashing in on today to make sure that you have regular, reliable income.
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What is Recurring Revenue?
Recurring revenue is a business model that gives you predictable revenues at regular intervals with a relatively high degree of certainty. It is a product or service that your customers can keep purchasing on a predictable basis.
With this business model, you are able to generate income that’s reliable and consistent month after month. It gives business owners financial peace of mind.
Getting that fear of not making enough out of the way, you can focus on more important things like enhancing customer support and the user experience.
Recurring revenue streams create a stable cash flow, contribute to client retention, increase your client base, and ultimately strengthen your bottom line. No matter what type of business you run, you will benefit from recurring revenue.
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Recurring Revenue Ideas for Your Business
There are several ways to generate recurring revenue for your business. Here are ten simple ideas to get you started:
Service Plans or Client Retainer Agreements
Service plans or retainer agreements are excellent for generating recurring revenue for business owners whose products or services require regular renewal. You can sell to your existing customers without the need for expensive advertising and marketing.
Retainer agreements are great if your customers require your product or services on a regular basis.
For example, freelancer Clay Mosley grew his business to over $1 million/year and 20+ employees by focusing recurring revenue. You can hear more about how he did it in the episode below:
This may include social media marketing, blog writing, website and hosting maintenance, and email marketing. You can also offer service plans for these long-term or other complex projects that tend to require a fixed number of hours from you each week.
If you’re not sure how to pitch a recurring revenue model to your clients, try listening to Chelsea Baldwin’s advice* on how and when to bring up a retainer model with your clients. *For SolidGigs members only. Try for $2..
If your business revolves around creating content, then an all-you-can-eat library is a great way for you to earn recurring revenue. You can create a library of content and build a membership subscription system that allows people to access it.
If you’re a photographer, you can provide stock photos that your clients can use for their blogs or social content. If you’re a graphic designer, you can design a bunch of vector graphics and other digital designs that people can use for social media.
If you’re a content creator, you can build a library of podcasts and webinars on topics that your target market would be interested in.
Building a Membership Program
A membership program lets clients sign up for ongoing access to a particular offering on a membership site. Here, you can deliver content, build a community, or offer consulting services for a monthly recurring fee.
With a membership site, you can deliver high-quality content, build an engaged community, and offer coaching services while increasing your business’ earning potential. What’s more, you can choose services and/or products that complement your business and sell them on your membership site.
Instead of being a one-off sale, you can hold on to repeat customers and subscribers who tend to stay for months. Customers are often willing to pay for access to specialized tools and personalized advice. You can charge monthly or yearly for routine services or information. What’s more, you can provide your customers with reliable and affordable support over time.
The great thing about membership programs is that they can encompass a wide range of niches.
- If you’re a freelance personal trainer, you can offer a 30-day fitness challenge to your members.
- If you’re a content marketer you can host recorded events, webinars, and conference calls for other digital marketers subscribed to your membership site.
- If you’re a content writer, you can create an online training course on blogging.
- If you’re a graphic designer, you can develop digital resources that you only share with your subscribers.
Online Courses as Evergreen Programs
Offering online courses as evergreen programs works similarly to membership programs. You can share your knowledge about a specific topic to paying students. The caveat here is that it can take a lot of effort in the beginning.
This is because you need to create the content and crank out a marketing campaign to get the word out to your target customers.
If you’re a digital marketer, you can create courses on social media marketing, advanced SEO strategies, or email marketing. For designers, you can offer an introductory course on graphic design or advanced Adobe Illustrator techniques.
Programmers can teach coding classes or the basics of web development. If you’re a translator, you can also teach language classes for beginner, intermediate, and advanced learners.
If you don’t want to give away the technical know-how of your trade, maybe you can teach other freelancers how to run their business with freelancing courses for beginners.
Software as a Service (SaaS) Offering
You can generate recurring revenue by offering software in exchange for a monthly or annual subscription fee. Even tech giants like Adobe and Microsoft went in this direction as opposed to their previous one-off selling strategy.
If you have a piece of software, it is a great idea to sell it as a subscription product because it will give you more freedom and time to improve the software itself. In doing so, you will have a better grasp of what your clients really need so you can continue improving your offering.
Generally, it’s easier to sell SaaS to customers since they don’t have to pay a large upfront fee. You can also offer several options and the flexibility to upgrade subscriptions as your clients’ businesses grow.
Some examples of SaaS options you can sell include customer relationship management systems, inventory management software, cloud-based storage solutions, and customer support management systems.
Affiliate marketing is an excellent way to generate recurring commissions. You can join another business’ affiliate program and get paid a specific commission for reselling their products or services.
Most programs are free to join, but some businesses require you to be an existing customer in order to participate. Typically, you get an affiliate link that tracks the visitors you send to their website, and if and when they convert.
There are many ways to incorporate affiliate links with recurring commissions into your daily business. You can post them on a resources page on your business website, weave affiliate programs into your blog posts, post reviews of affiliate products and services, or feature them in email campaigns. You can also turn affiliate services into potential add-ons to your product and service proposals.
Physical Product Subscriptions
A physical product subscription or box subscription is perfect for a business that naturally lends itself to mailing items. It’s also a great option for creative entrepreneurs who have access to niche communities.
Businesses the world over use monthly box subscriptions as client gifts, employee gifts, or just personal enjoyment.
Moreover, you can share your passions with your customer base and get paid for it. When thinking of what products to sell as subscriptions, ask yourself the following:
- What do I enjoy doing?
- What am I good at?
- What do I have experience in?
- What are people prepared to pay for?
- Who do I like working with?
All you need to get started is to source products in bulk at low prices, find a reliable order fulfillment and delivery platform, and do some creative marketing. The cost may be high in the beginning, but once you get going, your revenue will start exceeding your expenses.
There’s a lot that you can sell through physical product subscriptions. What’s important to note is that the products you include in your subscription boxes should be easily sourced, produced, packed, and shipped to your customers. The most popular these days are snacks and specialty foods, skincare and cosmetic products, and art supplies.
Combination of Online Membership and Physical Product Delivery
You can also combine a membership site program with a physical product delivery program for a richer customer experience. You can set up a community around a particular niche, provide content and education, and bundle that with a physical product.
For example, if you’re in the business of selling knitting supplies, you can create a members only club where people can sign up and get access to knitting and crochet tips, how-to videos, patterns, needles, and other related supplies. Members can also get monthly e-books or physical kits in the mail for small projects.
Peace of Mind Products and Services
Your clients are most likely worried about one or more things. As a business owner and service provider, you can help alleviate their concerns and get paid for it.
This business model is ideal for companies that lean towards minimizing the problems and fears that their clients face. For this, you’ll need to identify your clients’ concerns, then devise a pitch that addresses them directly and offers a solution.
For example, you can offer a social media reputation management service. You can also offer secure web hosting and maintenance, or hacker protection.
If you like socializing, teaching, or bringing people together, then establishing a private club is a great recurring revenue option for you. There are people who are willing to pay a premium for exclusivity, and this is exactly what this business model banks on.
With a high-quality club, you don’t have to be responsible for creating all the value and content for your members. Instead, this platform encourages community-building by getting members to help each other out.
This is especially great for coaches. Here, you can design both an online environment and arrange in-person meet-ups for your clients where they can exchange ideas and inspire each other.
You can create private social media groups, set up a coworking space, create private events and networking opportunities, or establish a mastermind group. You maintain a presence, but aren’t solely responsible for everything there is to learn.
What are the Benefits of Recurring Revenue?
Benefit #1: Revenue and Cash Flow
Following a recurring revenue model is a stable and predictable way of generating income for your business. It allows for a steadier stream of income than relying on one-off sales. This results in an increased top line for your business.
Recurring revenue also helps resolve any cash flow issues you might have like unexpected costs. You can develop and stick to a reasonable budget because you know for sure that you will earn a certain amount periodically.
Benefit #2: Predictability and Stability
If you have recurring revenue, your business cash flow becomes more predictable. You can forecast revenue and expenses as far as months or even years in advance. This can help you create and confidently allocate spending.
Benefit #3: Reduced Risk and Growth Potential
If you rely on one-off sales, you’re going to be exposed to lean and peak months. These income fluctuations can affect your growth potential. With recurring revenue, your business is exposed to less risk and you can seize more opportunities to grow.
Recurring revenue is crucial for every business owner who wants predictability for stability and better growth potential for their company. These days, there are a variety of ways to ensure that you get regular income on a monthly basis.
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