5 Ways to Generate Recurring Business Income

Clients today are looking beyond installation to find a partner who will maintain and update their AV systems and equipment. If your AV integration business model excludes providing value-added services, you are missing out on recurring business income. If you’re still not sold on the need to generate recurring revenue from after-sales service, consider the following reasons why it is helpful:

• ​Creates guaranteed profits: In the AV integration industry, companies are often hired to install a system that will be used for annual or ongoing events. However, these profits are not guaranteed to recur. Events are changing, and many companies are deciding against installing new AV systems in favor of hosting online events. Unexpected cancellations can damage the bottom line of installation-only AV integration businesses. With recurring business income from after-sales service offerings, AV integrators can still have money coming in even if there isn’t a demand for new system installations.
• ​Easier to plan: With consistent income, AV integration companies are better positioned to plan for growth, expansion, training, and more, unlike relying solely on installations, which can be unreliable and present significant challenges in revenue forecasting.
• ​Provides cushion for leaner times: Turnover due to a shortage of funds can lead to an AV integration business being understaffed or lacking employees with institutional knowledge right when they’re needed the most. Recurring business income and additional revenue streams can help integration companies keep experienced and productive staff members on board even during leaner times.
• ​Cost of services is less than cost of sales efforts: Landing a new installation project can be expensive and time-consuming for your sales team, often resulting in profits from only one standalone event. With alternative revenue streams like recurring business income from services, you’re making a profit each month without the same level of effort required from your sales team. Ongoing service contracts can help reduce operations and labor costs, while allowing you to grow your AV integration business.
• ​Monthly purchasing is growing popular: Subscriptions and monthly payment options are becoming increasingly popular. Companies want access to top-tier AV technology and services without huge, up-front investments. Leasing equipment and paying for it monthly creates an opportunity for AV integrators to offer equipment rental services to increase their recurring business revenue.
• ​Opportunity for deeper partnerships: Providing ongoing services and support is an opportunity to build a strong rapport with clients. This rapport means they will be more likely to turn to you for new projects and needs, as they trust your expertise and are already accustomed to working with you.
• ​Brand building: By offering additional services, you can grow your brand. More regular contact with your business helps people develop a greater affinity for your brand, which can also breed customer loyalty and create brand evangelists.

5 Ideas for Recurring Business Income

Now that you know how important recurring business income can be, you may be wondering what your company can do to develop consistent revenue streams. There are many things you can do to generate recurring revenue as an AV integrator, including adding or tweaking the following:

1. 1.Products: Many AV integrators make money by selling equipment together with integrated systems installation work. However, these sales are typically one-offs. If you add equipment leasing and maintenance services to your offerings, you can develop multi-year contracts, guaranteeing regularly recurring business income.
2. 2.Annuity services: These services are typically paid for annually or semi-annually, which helps with planning. Annuity services could include day-to-day technology management as well as support services like maintenance, repair, spare parts, and warranty coverage.
3. 3.Ongoing projects: These contracts are typically paid on delivery and may include consulting, integration, implementation, and training. For example, training a client’s new hires on how the various integrated technologies work could be an ongoing education services project.
4. 4.Subscription-based technology services: This is a common and successful add-on many systems integrators use to increase revenue from existing customers. This can involve charging clients monthly access fees for cloud-based technologies, allowing integrators to continue to innovate and offer clients the latest options while building rapport.
5. 5.Transactions: Offer adjacent services that bolster or improve your core offerings on a pay-per-use, transactional basis. This works well for products or services clients will need regularly, but perhaps not daily or weekly.

How to Find Even More Ideas for Recurring Business Income

Why stop at just five ideas for recurring revenue streams? There could be even more options that make sense for your company. Before rolling out new product or service offerings for your AV integration business, consider taking action to:

• ​Conduct research: Check out what your competitors are doing, and see how you can improve upon their offerings or adapt them into options that make sense for your company. Scrutinize their pricing models to evaluate profitability.
• ​Form an internal think tank: Gather key stakeholders in your company for a brainstorming session. They are subject matter experts and can provide insight into what you should offer and when.
• ​Check in with clients: If you have clients with whom you have great rapport, consider asking them about your offerings. See what they think about your current products and services, and what you could offer to improve their experience.

In conclusion, remember that every customer need is an opportunity for your business to generate income just by fulfilling that need. By truly listening to your customers, you can deepen your relationships with them, which can transform your bottom line and business as a whole.