If you’re a coach or other service provider, chances are the bulk of your income comes from working with clients one-on-one. And that’s great! I love nothing better than really digging in and working closely with a client.
But if working one-on-one is your only source of income, you’ve probably gotten to the point where you’ve realized there are only so many hours in the day. And you want to find ways to add other revenue sources to your business.
The good news is that there are 4 different types of income you can create, and within each of those types, are a variety of ways you can create that income.
It’s important to know the revenue opportunities AND decide which kind of revenue is best for your business. That decision depends on a few things including your strengths, list size and niche.
Let’s start by exploring the 4 types of income you can create as a service based professional.
Active Income
This is where you work one-on-one with a client, delivering your service. Active income is generally the fastest path to cash. However, if you’re not working, you’re not earning anything and you can only help a limited number of people.
Success tip: Package your services and sell a solution, vs. selling your time. The key to doing this effectively is creating your “Client Journey” or “Signature System”.
Leveraged Income
This is where you deliver your service one-to-many. This could include group coaching, workshops, events, Mastermind groups, etc.
The benefit here is that you’re earning more income for the same investment of your time. The challenge is that it can be harder to create and market programs vs. your one-on-one time.
Success tip: Sell it first, then create it. You should never put all the work into creating a program before you know it’s going to sell.
Passive Income
This is where you package and automatically deliver your information and ideas. Examples include home study programs, video training courses, ebooks, etc.
It’s a good thing to have because once you create a passive income product, you can sell it over and over again with no more investment of your time required to deliver the product. It’s all automatic.
Success tip: Create an “evergreen” program that you can use for years to come. Also, save all the templates, checklists, action guides, etc. that you use with your clients. You can package these as part of your passive income product.
Recurring Revenue
This is where you deliver your value and get paid month after month. For instance, you can generate recurring revenue with a membership program, software program, affiliate income, network marketing business. An example of this from my own business is my Membership Program, Smart Action Club.
One challenge with this type of income is that you need enough people on your list (or that you can get in front of) to make it really pay off.
Success tip: Ask joint venture partners and affiliates to help spread the word for you. Deliver great value so people want to stick around.
So there you have it. Four types of income you can create. Don’t attempt to create them all at once. Take a good look at where you’re at in your business, what your niche wants, and what your strengths are. Then choose one idea to implement at a time.
What kind of income do you most want to create in your business? Share your comments and questions below.
As a Divorce Strategist and Co-Parenting Coach, I amexcited to see your list of the variety of ways that I can move forward to create income in my business.
I plan to take action and get started putting together my first information product that I can sell online.
Congratulations Nancy! I remember that very first online sale I ever made. It was so exciting! Best of luck and don’t hesitate to let me know if I can be of any help.
Cindy, this is a great description of the different income types. I may share this link with some of my own clients to see what is possible for them. It has been on my horizon to create a membership program, and in the meantime, I’m creating new leveraged and passive offerings. It’s really fun to be able to look at the impact of a multiple-revenue stream business like this. Isn’t it exciting?
Amy
Thanks Amy! It is exciting! I think it’s very smart to start with leveraged and passive income.
One thing to think about with a membership program is that you want to ensure you have enough people on your list to make it worthwhile. Now it depends on what kind of membership program you have, but with an ongoing program (e.g. not fixed-term), It takes quite a bit of work. You have to provide ongoing content and support. And you generally don’t charge too much per person.
So let’s say you have 1,000 people on your list and you have a 30% open rate (which is very good). That means 300 people are reading your emails on average. If you have a 10% sales conversion rate (which is also very good), then you have 30 people in the program. If you charge $50 per month, then you get $1500 in residual income per month. Make sense?