Recurring revenue is what happens when services are charged on a recurring basis, typically monthly or yearly (like your cell phone bill), and it can mean a lot of good things for your business.

Not only will it deliver a consistent stream of revenue that you can (literally) bank on, but when it comes time to think about legacy planning and selling your business, a company built on recurring revenue will be more attractive to potential buyers.

With recurring revenue, you’ll be able to:

• Count on a more reliable and predictable revenue source
• Determine the value of your business in multiple ways with more stable metrics
• Sell additional products and services to your existing customers by upselling or cross-selling
• Keep your business aligned to your customers’ changing needs, offering better service
• Better determine your ideal customer by focusing on long-term relationships instead of quick sales
• Determine your pricing based on the value you’re providing, instead of undercutting to win constant price wars
• Make your company more valuable, better positioning you for a merger or acquisition