Recurring revenues are the lifeblood of your business. It does not matter what business model you have right now, what matters is that you make recurring income each month that you can count on and that hopefully, grows with each passing month and year to come. When you can count on your income growing each month and year, you know you’ve done something right. The top reasons you want recurring revenue streams are:
Work Once — Most recurring revenue streams are work that you do once, and keep getting paid for later. Such as eBooks, niche websites, and affiliate marketing. All of these require you to do the work once, and then you can get paid months and years later for your efforts today. Nothing is more fun than seeing money in your PayPal account for something you did two years ago.
Passive Income — Many types of recurring revenue are what is called passive income. That doesn’t mean you don’t do any work, but it does mean that you can keep earning on the same item. For instance, if you have a niche website or blog, that has some affiliate products, and Google AdSense as the revenue streams it can become almost automatic. Once you get the traffic up to a certain point, if you leave it for say a two week vacation, or a six week period of time off due to birth, death or illness you’ll still make money on the site.
No Limits — Unlike trading hours for dollars there is truly no limit to the amount of money you can make with many recurring revenue streams. Once you write an eBook and start selling it, you can sell it as many times as you want to. You can’t sell as many hours of Virtual Assistant time as you want to, because there are simply only so many hours a day. The same can be said for Graphic Design or any type of service business. While you love doing it, there are built in limits.
Avoid Burnout — We all need to take breaks. In the current service provider business model there is no room to take a break. How would you like the freedom to close down your business every holiday? What about taking month long vacations during the summer? Heck, how about taking a trip to a warm climate when the weather gets too cold at home? The possibilities are endless and having a recurring revenue stream allows you to be more picky about taking on clients so that you can truly do what you love.
More Saleable — The more passive and recurring income you have the more you can sell your business for later if you choose to do so. If you learn to separate yourself from your business model a little bit then you can eventually sell the business so that you can retire or move o to the next opportunity as you wish. A business that is named right, and has recurring revenue is just more salable than a services business with a good client list, without.