On this episode, Wilco talks the holy grail of online business. He explains what is the best business model you could have or you could add into your business today.
Here are a few interesting things you will hear in today’s episode:
• Learn what is Wilco’s ultimate goal in his business from his reflection.
• Wilco explains the benefits and advantages of building up a recurring revenue in your business.
So listen below to find out why you should start adding a recurring element in your business today.
Time Stamped Show Notes:
00:29 Holy Grail of online business.
01:25 Why am I in this business?
04:21 The main reason why it’s so awesome is you get to have predictable income.
05:19 Not only does it reduce stress, but it also allows me to build my business and scale it up
05:39 Why would you just charge a one time fee if you could also make sure that every single customer will one way or another would actually just keep on paying you on a monthly or a yearly basis?
06:55 Make sure to add a recurring element somewhere in your business
07:20 If ever you are planning to sell your business, then having a recurring subscription-based model in your business will seriously have a major impact on the evaluation.
It’s my number one priority in my business and that’s why I really wanted to take some time to basically hoping to inspire you to add this into your business as well in case you don’t have it yet. Last Sunday night I was doing my Sunday night routine, what I call it. Every Sunday night I sit down for an hour and I write down all my current goals and I write down what my achievements are going to be like for the next week, what I need to achieve, what I need to do exactly so I can start the week pretty much with a clear mind and a clear vision so I know exactly what to do.
Last Sunday night I was doing that as well and I was thinking about what is the end goal of all this. Why am I in this business? Why do I run this business? What’s the ultimate goal that I want to get out of it? For me it’s not money or it’s not, I don’t know, people looking at me or whatever it is that might inspire you. For me personally I’m doing this for freedom. I really want ultimate freedom, not just financially, but pretty much in every aspect of my life.
A big part of that means that I want to live a stress-free life pretty much, right? For a big part I think I’ve pretty much covered that. I’ve been able to travel the world every single year. We usually go abroad for a couple of months or we just travel and we explore places. That’s awesome. It’s great, but at the same time I remember a couple years ago when I was doing all of that, I was traveling the world. Me and my girlfriend, we were traveling through Thailand, Laos, Cambodia, Vietnam, Australia, all these awesome places, but I was not ultimately free because I remember that while I was doing that every single day right after breakfast, this was during our travel trip.
Every single day right after breakfast I went back to my room, my hotel room, and I opened my laptop, checked my statistics and I remember every single day I went to check how many sales I generated from the day before. Every single time that I did not hit my goal, my criteria that I wanted to hit, my exact sales figure number, I felt down. We were doing awesome things. We were doing things like riding elephants. We were swimming with dolphins and all of that, but I felt down because I didn’t hit my sales quota, my sales number the day before, which is insane, right?
I was living the life, “the life”, but still I didn’t really feel like I was ultimately free because I was still sort of chasing this goal or chasing my business. I think a big part of the reason for that was because every single sale that I made back then was a one time sale, which means that every single customer would just have to pay once and they would get pretty much a lifetime access to whatever I was selling. There was no incentive for them to pay us at a monthly or a yearly fee.
That means that every single month I needed to make X amount of sales to at least cover my expenses. I have my whole team, I have my whole staff and a lot of expenses like server, [inaudible 03:34] and all of that. Only after X amount of sales I would even start at zero. Every single month at the first of the month I would start off with zero sales and you know, the game starts all over again pretty much.
To me that’s not really freedom because you’re always chasing, you’re always having to get new customers because if you don’t then you’re being left behind and you’re actually losing money, right? Over the last I think two years or so my number one priority has been to build up recurring revenue. That is what I believe the Holy Grail of online business or pretty much any kind of business actually.
Now, for me personally I’m doing it as a service, but there’s obviously lots of ways that you can charge a recurring fee in your business. The main reason why it’s so awesome is now you get to have, once you do this, you get to have predictable income. It’s not just about selling products every single month, but now you actually know even if I don’t sell a single product next month I’m still going to do X amount of revenue next month and the month after and the month after and even next year because you know you have X amount of people on a subscription basis and you know if you look at the numbers, X percentage will actually cancel on average. That’s usually normal.
You can still calculate exactly how much revenue are you going to get over the next month and the next month and the next month, et cetera? Not just does that reduce a lot of stress, at least for me it takes pretty much away all my stress because I know my business is going to be good for a long time, but also I get to invest way, way more back into my business because I have this predictable income. Because now I can easily make commitments. For example big investments for a year period because I know it’s going to be good because I know I have this predictable income.
Not only does it reduce stress, but it also allows me to build my business and scale it up because I get to invest more without taking all the risk that comes with it. At least way less risk, right? Obviously it’s also way easier to keep a customer than to always get a new customer. Acquiring a new customer is always more expensive than keeping an existing customer. Why would you just charge a one time fee if you could also make sure that every single customer will one way or another would actually just keep on paying you on a monthly or a yearly basis?
Now, obviously you don’t have to make this your number one goal, you don’t have to change all your business and make sure that every single product isn’t just a recurring base product, but you could easily add this in. For example you could have it as a one time offer. For example if you sell a product, then as an up sell you could for example charge something as a recurring fee. Or you could just have some extra services that you could add to your customers or offer to your customers at the monthly or yearly fee.
Whatever you do, try to add this somewhere in your business because it’s going to make all the difference. Of course the start might be slow. When I started off it wasn’t a jackpot right away because actually conversions went down. It’s way easier to sell something at a lifetime fee versus a recurring fee because a lifetime fee doesn’t have the lifetime commitment for our customer while at a monthly or yearly fee people are asking themselves, “Hey, do I really, really want to have it?”
Conversions will go down, so it’s going to be a bit tougher in the beginning, but once you’re through the first initial part it’s going to pay off big time. I would never, never, ever go back to where I was a couple years ago. I just love it. Seriously, if you have a business, no matter if it’s online or offline, make sure to somewhere in your business add a recurring element. Charge something at a monthly or yearly fee, start building it up.
For example, if ever you are planning to sell your business, some people are into that, then having a recurring subscription-based model in your business will seriously have a major impact on the evaluation, on how much money your business is actually worth. It’s actually a good thing for that as well. That’s really what I wanted to share with all of you. Make sure you have a recurring element in your business and don’t do it tomorrow, don’t do it next week, but start making plans today. Talk to you all soon. [/otw_shortcode_content_toggle]
[tweetthis display_mode=”box”]”I really want ultimate freedom, not just financially, but pretty much in every aspect of my life.”[/tweetthis] [tweetthis]”Make sure you have a recurring element in your business and don’t do it tomorrow, don’t do it next week, but start making plans today.”[/tweetthis]