Why would you want to develop some alternative revenue streams for your small business? For lots of reasons! Diversification and customer retention, for a start – customers who have a wide range of sevices and products from which to choose are happy customers!
Alternative Revenue Streams: Things to Consider
You can’t provide everything, so choose your alterative revenue streams wisely. You need to consider:
Your core competencies
Adjacencies to those competencies
Your existing customers
Standard types of alternative revenue streams
How to decide what your core competency is? This is your bread & butter! A core compentecy is your competitive advantage, what you are known for! You should be better at your core competency than everyone else is. It’s probably the reason why you went into business.
Logical adjancenies are potential alternative revenue streams that are strategically aligned to your core competency. They steer what you offer in a defined direction. Some different ways to pivot when you do adjacencies is if they are a new product or service for your existing customers or if you are doing the same product or service for a new target market. Both are a natural step in growing your alternative revenue streams strategically.
Strategies to develop alternative revenue streams that focus on the existing customer include:
Increasing the average sale from a customer
Increasing the frequency with which customers use your business
Offering something new that customers also need
Developing more effective retention strategies.
Keeping a customer is worth even more (and is much less expensive) than finding a new one!
Strategies to develop alternative revenue streams that focus on new customers include:
Targeting new markets
Testing new offerings
Standard Alternative Revenue Streams
Standard alternative revenue streams include:
New products, services, intellectual property, programs
Learn More About Alternative Revenue Streams
When it comes to alternative streams, the limit is really only the resources that you have available to implement them and oversee them. The general rule is that, regardless of how many revenue streams you have, 20% of your revenue streams should be producing 80% of your income, so focus on that 20%…but make them what you want! You can do one or more of them, blend them…have fun!
Have you ever wondered what the difference is between a credit union and a bank?
Are you curious about why you might choose one over the other?
Keith Taylor of DUCA Financial Services can tell you – and he does. You’ll learn about:
What DUCA is and how a credit union is different from a bank
The different programs that DUCA can offer as a credit union including the Profit-Sharing Program and Profits with Purpose. There is also a Community Hero Mortgage with a profit donation program with in.
What B-Corp certification is and why DUCA works to maintain it including ensuring that they are paying all employees a living wage (including benefits) and were the first to do so.
What DUCA offers businesses from no or low-fee business banking and all of the other account options.
Plus there is business lending with lines of credit, loans and mortgages just like you would expect from a bank. But the added advantage for small business owners is the relationship that they have including having a designated Small Business Advisor for all business members.
The DUCA Impact Lab – what if banking’s primary focus was on solving problems and creating opportunities for everyone and not on simply making a profit?
Get a pen and pencil and take notes,
because the quicker you start selling, the quicker you start making money!
In this webinar you’ll learn:
Why the length of the average sales cycle means that you need that you need to start selling as soon as possible after opening your business.
Why the reasons people give for why we they’re not selling aren’t usually the real reasons
Why it’s good to “fail fast”
How you can quickly and cheaply create a web presence while you’re waiting for your website to be ready
How to create your first batch of business cards/brochures, and why they don’t have to be perfect
Why you don’t need inventory, or even a prototype, before you start selling
How to quickly draft a serviceable client contract
How to choose a business name and how long you should give yourself to do it
Why your business doesn’t need to be a corporation before you start selling
Why you need to talk about your business with other people
Everything that Carla talks about is an action step that could get you selling within 2 weeks. Which step are you going to take? Let us know in the video comments, on Twitter or Facebook, or at firstname.lastname@example.org…and don’t forget to come back and tell us how it goes!
If you fail to plan, you plan to fail – that’s why writing a solid business plan is the best first step you can take toward making your dream of owning a successful small business a reality.
In this recording of our “Writing a Business Plan to Get What You Want!” webinar you’ll learn about a Business Plan and its sections, including:
The importance of deciding who the plan is for
The Business Overview – Talking about The Opportunity and why what you offer is The Solution; defining the target market; describing the unique aspects of a business that give it a competitive advantage and how the business owner intends to keep that advantage
Vision – Where the owner sees their company in 3 – 5 years, the ultimate goal for the business, and a description of the exit strategy
What to include in the Marketing Research section – Industry trends, consumer trends, wider general trends (government, economic, technology) that may impact a product; a business’ main competitors and their potential impact.
Sales Projections – How to calculate reasonable sales projections to include in a business plan
Management Team – Why is the owner the best person to launch this business, given their support team and contacts?
Marketing and Sales Strategy – The plan to get the word out about products given factors like prices, location, size of area to be covered, marketing budget, and projected sales
Operations – Discussion of operational issues like processes and delivery; how processes will be tracked to ensure completion; who handles human resources issues like hiring, scheduling, etc., and how they will be handled.
Action Steps – The importance of showing the company’s goals for today, as well as its Short Term and Long Term goals.
Financial Projections – Demonstration that the business is financially viable and sustainable over the long-term.
Executive Summary – Written last, but first thing reader sees. Must entice reader to keep reading.
Increasing our small business revenue generation is something that most entrepreneurs are concerned with. In this video we learn why all entrepreneurs need to make it the top priority and we walk through the 4 main things that we need to focus on to help our revenue grow.
1. Number of leads
2. Improve conversion rates
3. Increase the price of the average sale
4. Increase the number of sales per period
Plus we walk through all of the tools we have at our fingertips to help improve these 4 areas. Watch it now!
Business valuation is critical for all small business owners as there is a high probability that you will be needing to evaluate how much your business is worth due to needing a loan, going through a divorce, or selling your business either voluntarily or involuntarily.
When it comes down to it, the value of your business is the price that someone is actually willing to pay you for it. But if you are trying to put a dollar value on your business without this step or before this step, there are some things to consider;
1. Net tangible assets
2. Identifiable intangibles
3. Goodwill (transitioned and non transitioned)
4. Redundant assets
If you are selling your business, there are some great ways to increase the value of your small business. And there are some specific value drivers to be aware of.
If you are buying a business, there are some specific details you should be looking for and specific circumstances where you may buy a small business for a lesser amount.
Financial management and understanding numbers is a daunting topic for many entrepreneurs. However, this is a vital skill when speaking with investors and bankers that will help your business grow and/or survive.
This video will give an outline of what numbers are important and some basic ratios to test on your business.
Some concepts that are very important are;
1. Reviewing your past performance and changing trends can spot problems early.
2. If you don’t have past performance you can also track against industry averages. This can be done based on the industry that you are in and the size of your business.
3. Financial ratios help you determine if there are problems in specific areas in your business.
– the quick ratio and acid test
– accounts payable and receivables turnover
– debt-equity ratios and interest payable
4. Creating a 1-page business performance dashboard helps you see all of the financial metrics in one spot.