The changing of the calendar and the dawn of a new year is a traditional time to reflect on what’s worked, what hasn’t, what should change and what should stay the same, both in our personal lives and in business. So how’s your recurring revenue plan coming?
After all, this is the most common time of year when just about everyone is focused on the big changes that will affect your company in major ways in the coming year.
In the AV integration world, if you haven’t started thinking about—at the very least—adding a recurring revenue element to what you’re doing, you’re missing out on a lot of opportunities with your customers.
In fact, you could be doing them a disservice in a time when being a systems integrator is about a lot more than opening up a bunch of boxes and installing components.
In fact, if you don’t reinvent your business by adding new service offerings when the opportunity arises, there’s a good chance you’ll miss out on growth and sales.
John Fry of ConnectWise stressed the importance of incorporating a recurring revenue strategy into their business plans for 2018 and beyond as the emphasis on selling boxes continues to give way to the approach of selling technology solutions.
And ConnectWise CEO Arnie Bellini says some of the company’s new products will help its customers improve efficiency, reduce complexity and drive revenue growth.
If you’re not already involved in a recurring revenue model, you’re well behind many of your competitors. That said, 2018 is the time to embrace an “as-a-service” model and start charging a flat monthly fee for all the technology services your clients need.
By doing so, you’ll be able to become more competitive, make more money, become stickier with your customers and increase the value of your business.
Become More Competitive
When you don’t have steady recurring revenue at your business, you stress over whether or not you’ll make enough money every month and generally go from one project to the next without any sort of continuity or plan to work with that customer again.
That stress forces you to focus on keeping your business afloat, and robs you of the time and flexibility you need to take business risks and work on your long-term growth strategy.
By adding a service component and a recurring revenue stream, you could be bolder in the way you run your business knowing that your cash flow would remain the same no matter what.
More specifically, you could go after harder-to-land clients, pursue new projects you wouldn’t have time for otherwise, or take action in other ways that would make your business more competitive.
Make More Money
Having clients who pay you regularly will help you make more money consistently, which is obviously a good thing for any company that’s looking to grow from year to year.
While it may take some time and effort to start offering new service bundles that attract consistent clients, it’ll be well worth the greater long-term profitability, and success for your business.
Most customers today don’t want to shop around for one company to install their technology and another one to provide service related to that technology, which is why “as-a-service” is such a critical piece, says ConnectWise.
Become Stickier with Your Customers
If you just sell your clients technology, they’ll likely shop around for a better price. After all, they can probably get similar products from your competitors.
On the other hand, if you sell clients a service bundle, and position yourself as a helpful advisor who teaches them how to use technology to reach their business goals, they’ll see you as indispensable.
In other words, they won’t leave the second they see that someone else has a cheaper offering; you’ll be too valuable to their business for them to give you up.
Increase the Value of Your Business
When investors determine the value of your business, they look at three things: predictability, profitability and diversity. You need to show that your business can generate predictable recurring revenue.
Expanding your service offerings by implementing the “as-a-service” model is the best way to make that happen. Then, when it’s time to sell your business or pass it on to the next generation, you can feel confident knowing that it’s valuable.
When you expand your service offerings, you’ll be able to make more money, grow and increase the value of your business, and enjoy your job much more. And at the end of the day, that’s what entrepreneurship is all about – building a business you’re passionate about, and proud to own.
Click here to get your copy of ConnectWise Ultimate Guide to As-a-Service to find out more about how you can add a recurring revenue component to your business.