Creating a Secondary Revenue Stream for Your Business

Apr 13, 2023
Creating a Secondary Revenue Stream for Your Business

Developing a secondary source for revenue helps protect a small business from fluctuations in the market and unexpected slowdowns. Offering relevant and logical complements to your current products and/or services can help you diversify your revenue, increase your overall profitability, attract more customers, and cushion your business against market changes, all without requiring a large investment or separate area of expertise. There are several substantial benefits to adding a secondary revenue stream for your business. A secondary source of revenue helps:

·       keep cash flow steady during slow periods

·       manage fixed debt payments when revenue is down

·       guard against inflation

·       create opportunities for seasonal work

·       protect against an unexpected loss or emergency

·       reach financial goals faster

·       build a larger client base

Opportunities to diversify your revenue may be right in front of you; the best place to look is in your business for the equipment, items, and products you already have, as well as your own areas of expertise: you are your own best resource. To supplement your main revenue source, consider things that complement your main product line, make use of your equipment, or draw upon your expertise in a relevant way. Some popular ways to generate a secondary source of business revenue may encourage you to:

·       offer consulting services

·       sell advertising space

·       lease out equipment that is not in use

·       build an online store

·       create a subscription service

·       rent out space or storage

·       host in-person or online seminars

Financial software simplifies the management

Adding a second revenue streams requires organization, particularly regarding the bookkeeping for proper financial management and accurate assessment of how well your secondary revenue stream is performing. Automating bookkeeping services can help you stay on top of all aspects of financial management and keep your cash flow steady. When adding a secondary revenue stream, consider bookkeeping tools that help with specific needs: analyzing income from multiple sources, tracking expenses specific to each project, categorizing invoices, and issuing prompt bill payments are the vital, fundamental bookkeeping tasks that will require special attention to detail and good organization to keep two streams of revenue working optimally together.

Tracking time and expenses

Time- and expense-tracking tools can help you best assess the costs of adding another branch to your business, as well as how much time a new prospect may be pulling from other projects and how efficient it is overall. Keeping track of your expenses and categorizing them will help you better analyze changes in cash flow and assess how profitable your new venture is, as well as how it compares to your main revenue source. Your time, which is also highly valuable, should be tracked and measured, too, so that you can see how many hours you (and your employees) must devote to marketing and maintaining this secondary revenue stream. Is it consuming too much time? Is it worthwhile? Can the goals be accomplished more efficiently?

Importing data seamlessly

Financial management tools for busy entrepreneurs managing money from multiple sources work best when they work together. Opting for bookkeeping tools that integrate with one another means that you can simply add on needed bookkeeping features to the software you are already using for the most simplified and streamlined management. Selecting services that work together also means that you can add an expense or update an invoice payment into your records and it will be appropriately categorized and updated across all channels in real time.

Recording payments

Adding a second source of revenue likely means having some additional payments to issue. If your new revenue source requires a more robust marketing budget and additional vendors, employees, or outside freelancers, you will have more financial responsibilities to stay on top of. Online check printing offers the most economical and reliable way to issue prompt payments on demand, with guaranteed, real-time record-keeping. Online check printing that integrates with other bookkeeping and payment-tracking applications can keep your finances organized and your tax preparation as simple as possible. Checkeeper integrates seamlessly with QuickBooks Online, FreshBooks, Gusto, Square, Harvest, Xero, and more for the most streamlined addition to your financial management toolbox.