How confident are you in what your top line revenue will be next month? In 6 months? Consider what having predictable revenue would do for your business. No, not educated guesses from fancy spreadsheets. I’m talking about predictable revenue.
Predictable revenue is the portion of revenue that can be counted on coming in – just by doing business as usual.
This is created through recurring revenue streams or repeatable sales processes. Take these examples (all real businesses):
- Subscriptions — A winery with highly seasonal visitors starts a wine club to create a steady source of year-round revenue.
- Repeat Customers — A restaurant hosts weekly trivia nights to encourage consistent repeat customers.
- Service/Support Agreements — An IT company focuses on annual managed service agreements instead of reacting to project and support requests.
This concept can be taken one step further up the funnel by making the sales process repeatable. Building a recurring source of leads, even if the customer is only a one-time customer, also improves revenue predictability.
- Partner/Referral Network — A web development studio partners with design agencies who will pass along regular clients referrals.
- Niching Into a Market — A construction company niches into financial institution construction, generating consistent leads from referrals, industry events, and acquisitions.
- Digital Advertising — A home service business generates a consistent source of leads (for over 6 years) using digital advertising campaigns.
Why does this matter? For starters, steady revenue is healthy for any business. But more importantly, this allows decisions to be made strategically. It gives you confidence. It gives you stability. It’s a way to intentionally build a stronger business.