The COVID-19 pandemic has changed virtually every aspect of the world that we once knew. Nearly every industry, every market, and every economy in the world has been disrupted, and our day to day lives have been changed for months on end. Businesses are struggling – even those who are attempting to recover. With loss of wages, loss of income, loss of revenue, and less support from customers who are still a bit wary of breaking quarantine or spending money, businesses have certainly felt the financial impact of this pandemic.
According to Johns Hopkins, more than 19 million people have fallen ill with COVID-19 since the onset of the pandemic back in January, and with that, economies around the world have shrunk dramatically. In the US, for instance, second-quarter GDP plunged 32.9%, which was the worst percentage ever recorded. In fact, it’s even worse than both the Great Depression and the Great Recession.
No one can argue that COVID hurt businesses, but it’s also true that businesses struggled with inconsistent revenue long before the pandemic.
The good news is you can overcome the challenges presented by COVID-19. There’s a proven strategy any business can use to prepare for future events just like this, where an unforeseen change or catastrophe affects markets worldwide. It all comes down to recurring revenue.
What’s recurring revenue?
Recurring revenue is revenue that you receive on a recurring basis – weekly, monthly or annually. In other words, it’s revenue that you can depend on and project. This isn’t necessarily a new concept, but it’s something that not enough businesses truly take advantage of. And in a post-COVID world, it might be the one fail-safe that you can use to ensure that when – and if – that second wave hits, your business is already prepared to weather the storm – and the aftermath.
Recurring revenue “is the backbone of SaaS and subscription-based companies. At these companies, customers purchase a service on a consistent basis, giving the company the ability to project future revenue more accurately. Recurring revenue can be calculated with metrics like churn rate and user growth rate for a realistic view of the company’s future income. This type of predictability is very valuable in business.”
This definition from Baremetrics.com truly hits the nail on the head because it’s that level of predictability that makes the recurring revenue concept so important for businesses – especially in a post-COVID marketplace.
Many of the businesses that flourished during quarantine were businesses who have adopted the recurring revenue concept – and this wasn’t by accident. They knew exactly what they were doing.
Recurring Revenue Examples
Many familiar subscription-based businesses like Netflix, Amazon Prime, Spotify, Hulu, Adobe, Microsoft 365, other Cloud storage providers like iCloud or Dropbox, are great examples of recurring revenue done right.
Most of these companies saw their user base either increase or at least stay the same during COVID because they’ve become essential to their users. And while all of these businesses sell a different service – they are all using the subscription model to create recurring revenue.
Adding subscriptions to your business is the single key shift that you need to make in order to ensure that you survive, thrive, and endure, no matter what the future may bring.
The challenges of creating Recurring
Revenue in your business
As with any new business strategy, adding recurring revenue to your business has its challenges. You need to figure out how to package your services into subscriptions and what to charge, as well as how to manage payments, redemptions and refunds.
Technology Can Help
The best way to get your new subscriptions up and running is to use technology to sell the services, collect payments and allow customers to manage their subscription. There are a number of software platforms that can help you set up a subscription service for your company, but most of them are limited in what they allow you to do – or only work for a single industry.
Upscribbr is an app that enables you to create and advertise subscription plans to local customers. Discover new customers, get predictable revenue and get more time to serve customers better by cutting down on-site transactions.
Upscribbr brings together all the tools you need to market, manage and track your subscription business in one convenient package. What’s even better is Upscribbr is super easy to use and it’s free to list your business on the Upscribbr Marketplace!
Ready to create a pandemic-proof business?
Build a strong, thriving business in any economy! Use Upscribbr to create recurring revenue.
Marketing specialist @ Upscribbr