subscription model

A Guide to Creating Recurring Business Streams

Once you start a business, do not expect smooth sailing. There will be ups and downs, but you at least expect to achieve some baseline revenue. It is not straightforward to accomplish that, either.

How do you get a recurring revenue?

What is recurring revenue? Monthly recurring revenue is part of your business revenue that is likely to continue. It is the expected income. It is predictable and steady.

How to create recurring income? When generating recurring revenue, ensure that your business can work without you being involved as a direct salesman. The business must run on its own.

A subscription model

Think of any subscription you might be familiar with. Be it a newspaper delivery, household items, and magazine delivery. Most subscription model businesses like Amazon offer a ‘Subscribe and Save’ of up to 15% for automatic deliveries. 

According to McKinsey and Company, 15% of online shoppers have subscribed to one or more products. Sellers offer discounts which are an effective technique of generating a recurring income stream.

Don’t deny your customers the one-time purchase option. However, offering products under discounted subscriptions will make it hard for customers to resist buying.

What is a subscription?

Subscription is used in sales where products/services are delivered to customers at intervals at a set price per interval. Each sale presents a decent offer. The subscription market has grown over 100% in the past 5 years. 

Subscriptions work for all kinds of online, offline, retailers and service businesses. Try it, and it could work wonders for you.

Benefits of subscriptions

purchase order

Benefits for business owners

  • Increased customer loyalty
  • Increased opportunities to cross-sell or up-sell
  • Recurring, predictable revenue

Benefits to customers

  • Convenience
  • Savings from discounts
  • Cost-effective on reducing transactions and bank charges

Popular types of subscriptions


There are several creative ways to get started with your subscriptions. Here are some ways to do so:

Product subscriptions

It is simple and familiar. You provide this under the “Subscribe and Save” basis. Customers sign up at each interval to receive your product/service at a discount. It is simple and effective.

Subscription boxes

Subscription boxes went big in 2018. Customers pay a monthly fee where they complete a quick survey on their preferences and receive boxes full of goodies that match their taste monthly. It works perfectly for many industries. 

Recurring revenue business ideas

light bulb idea

There are numerous ideas on recurring revenue businesses. 

Let’s say you run a coffee shop. You can provide subscription boxes for coffee beans. You can give 10 coffees at a discount in a month. 

Membership sites

If you have a website that provides information, you can encourage users to sign up and bill monthly to view the information.

Physical product subscription

Consider They send in snack boxes from different countries monthly.

Service plans or retainers

Give offers that customers can pay every month. You don’t have to approach customers every time they need assistance with your products. Use a business subscription model where you don’t quote every time. 

Club subscriptions

Be creative and make everything look exclusive. They don’t work for all businesses. Research on your customer base to see if they are willing to pay for it. You can give socks of the month/wine of the month.

Gift subscriptions

In the subscriptions that you offer, present them as gifts to family or friends.

Downside of subscriptions


Subscriptions have some shortcomings. You need to evaluate if the benefits outweigh the disadvantages and make an informed decision. 

  • Reduced profit margins

You need to use incentives to lure customers into subscribing. Giving discounts greatly reduce your profits. If your product is used daily by users, avoid discounts and instead emphasize on time-saving on the subscription.

  • Ongoing management

You need software to manage these orders like Zoho and Salesforce.

  • Not for every product or service

Depending on the industry you invest in, it might not work for you.

Key takeaway

You must explore deeper about subscriptions to learn the best options available for your business. Ensure your customers are aware of the new subscription model and understand its benefits. Also, learn how to promote your subscription offering.

How to promote your subscription offering

word of mouth marketing


  • Blog about your subscription.
  • Use an email campaign.
  • Create videos on your YouTube channels.
  • Share info on your business on social media.


You can offer in-store with flyers, magnets, and any other relevant promotional material. 

How will recurring revenue help you get the best funding?

Recurring revenue is a recipe plan for success. For you to be approved for business funding, you need to have a minimum monthly revenue.

How do you start creating recurring billing for your customer? Obviously, we as a recurring billing software can help with that! Contact us today if you want to learn more.