Project Revenue versus Recurring Revenue

Text of my newsletter from 28th February

If you prefer to listen:

For the first 4 years of my business, I only had project-based income.

That was fine as long as new projects were coming in but, even in good times, the revenue stream was un-predictable.

Plus, there was always the pressure of drumming up new business while I was working on delivering current projects – that was tough.

So I introduced a website maintenance and technical support service, which I positioned as a monthly subscription, or retainer.

It gives me more flexibility in how I charge for new projects, because I can use it as a bargaining chip: a reduced development price for taking the maintenance plan.

Given the growth of cybercrime, and the need for website owners to be on constant alert for hacks, the maintenance plan offers a major benefit to webmasters.

That said, I’ve found that selling a maintenance plan on its own – without having first built the website – is tough. It’s hard for non-technical people to understand exactly what they’re getting, unless they fully appreciate the threats their websites face.

It’s only ever happened for me when people came to me first with a broken website.

Generally, I’ve found it easier to pitch both the development project and the maintenance plan at the same time.

How it helped

So what benefits did the maintenance plan offering bring me?

It certainly smoothed out the revenue stream to my business, which is good.

But, today, I may not be in business at all had I not developed it.

The events in Hong Kong since 2019, when the protests started and, for the last 2 years with Covid, have decimated many businesses here.

Around 40% of my customers have closed their businesses and left Hong Kong.

More damaging for my business, no new people are arriving to set themselves up – so no new projects.

I’m still here largely because of the monthly recurring revenue that comes in from maintenance plan customers.

If you’re able to find a way to create a monthly recurring income in your business, I really recommend it.

In bad times, it may save your business. But even in the good times it will make the revenue flows for your business more predictable.

This week’s links

The first link today goes to a podcast in which John Jantsch and Brian Weaver discuss how new small businesses can find their niche and scale their business.

They also talk about the pros and cons of project-based income versus retainer income, which I just talked about.

I’ve also covered 19 digital marketing tips, possibly the simplest description I’ve heard of web3, and how to position your content for the maximum SEO benefit.

Finding your niche and scaling your business

In this 18-minute podcast John Jantsch discusses with Brent Weaver how new businesses can find their niche and scale their businesses. They also discuss the pros and cons of project vs retainer revenue models:

Finding your niche and scaling your business

19 easy digital marketing tips

Si Quan Ong sets out 19 digital marketing tips in this article. They are primarily ways to get visitors to your website but, even if you don’t yet have a website, there are plenty of general marketing tips here:

19 Easy digital marketing tips

What is web3?

This is possibly the simplest description of web3 that I’ve come across. It’s an 18-minute podcast in which Mark Schaeffer and Sandy Carter discuss and describe web3:

What is web3?

Best word count for SEO

Ann Smarty shows how there is no ‘best word count’ for SEO, and sets out other content factors that are more effective at boosting your website in the search results:

Best word count for SEO

———-

Just so you know: this email may contain affiliate links. If you click one of them, and make a purchase, I may receive a small commission as a ‘thank you’ from the product or service provider. I only link to products or services that I use, or have used, and am proud to be associated with. There is no additional cost to you.

Cool (and smart) people and businesses to follow

Smart, current and insightful tips from:

Adam Grant

American Marketing Association

Useful resources

Integrate your apps, devices and services to automate effectively

Marketing software

Fun flashback

Duran Duran were huge in the 80’s, they even got to do the theme for the James Bond film ‘A View to a Kill’. Here’s ‘Save a Prayer’:

Join us

Struggling to grow your business?

Every week, I do deep-dive research into the mass of information on how to start and grow a successful small, indie or one-person business.

Join us, and you will be among the first to receive the best resources I find each week – in your inbox, every Monday:

Fire up your business growth – get 4 top tips a week:

.

Cheers,

Martin Malden

Share the love: