A successful business does not rely on just one product or service. It relies on multiple sources of income or revenue streams.
Revenue Stream Definition
What is a revenue stream? A revenue stream refers to how a business brings money into the company. There are two basic types of revenue streams: active and passive.
Active Revenue Stream Examples
An active revenue stream is income related to products and services that require you to be directly involved. Examples of active revenue stream activities include:
- Calling a client
- Building a house
- Managing a business
- Coaching a sports team
- Speaking at a conference
Passive Revenue Stream Examples
A passive revenue stream is income related to products and services that do not require you to be directly involved. Examples of passive revenue stream activities include:
- Selling a book on Amazon.com
- Receiving subscription payments
- Receiving money from rental property
- Receiving dividends from stocks or mutual funds
- Receiving a usage fee for someone using your property
Recurring Revenue Stream
A recurring revenue stream is a steady source of cash that continues into the future without drastic changes. These include the sale of products or services you can procure over and over again. Nonrecurring or one time revenue is cash earned once and not again. This would include the sale of your house. Building dependable sources of recurring revenue is important for the longevity and stability of any business.
Revenue Stream Ideas
1040TaxBiz offers a variety of solutions to increase revenue streams to your business. Whether you have an existing business or want to start a home based business, we can help you. We put you in the tax business. Below are some existing businesses that can benefit from being in the tax preparation business. They all have one thing in common. What do people do when they receive large checks?
- Pawn shop
- Retail store
- Grocery store
- Appliances store
- Auto mechanic
- Clothing store
- Car dealership
- Furniture store
- Electronics store
- Check cashing store
- Rent to own (RTO): appliances, furniture, laptops, computers, electronics