According to recent studies, existing customers are 50% more likely to convert than first-time buyers. Better still, these older customers also spend a whopping 30% more when filling up their shopping carts.
Statistics such as these explain why a growing number of businesses are migrating from one-off sales to recurring revenue models. With the right payment environment, it’s possible to bill your customers every week, month, or year – generating a continuous flow of incoming sales that allow you to better manage cash flow and ongoing expenses.
The question is, how do you set up a recurring revenue stream for your business?
Transitioning to a subscription-based business model
If yours is a service-based business, setting up subscription options should be relatively straightforward. Instead of charging per session or visit, you can set up retainers with your clients so that they have access to your services throughout the year.
As a pest exterminator, for example, you might charge an ongoing fee to visit each customer’s home for quarterly inspections and control.
If you primarily sell physical goods, it’s still possible to add subscription-like components to the shopping experience. If you own a plant nursery, for instance, offering flower arrangement workshops, gardening tutorials, or sustainable farming seminars could generate a steady stream of incoming revenue from many of your existing customers.
Even one-off purchases (such as pool installations) lend themselves to recurring revenue options. For example, you could offer monthly maintenance or annual cleaning after installing your next swimming pool.
The above examples are merely scratching the service. Just know that with the right approach, you can look beyond your normal products and services to identify ways in which to offer tangible (and monetizable) value to your customers.
For a longer list of tips on how to create recurring revenue streams, check out the accompanying resource.
p>Infographic created by Clover