It’s just too expensive to chase after new customers all the time. If you want to create stability and cash flow for your new small business, you must create a recurring revenue stream. It means looking for ways to charge customers over and over again.
A recurring revenue stream is money coming in every week or every month from the same customers. Banks, for instance, enjoy a recurring revenue stream in the form of your monthly account charges.
Here are three ways your new business can embrace monthly revenue:
– Sell a consumable product. Ideally, your business will sell something customers naturally use up in a week or a month. Bottled water companies serving corporate offices simply show up every week to replace empty water cooler bottles and charge the client.
– Get contracts. An agreement to supply goods or services for a year or more to a customer is money in your pocket. Contracts create predictable income, so you can build your business.
– Initial sale with service plan. Look for ways to support (and charge) your customers beyond their initial purchase. Car dealerships will make money selling you a vehicle and then make more money by keeping you coming back under a service program or for regular oil changes.