Time to jump in and figure out this whole revenue modeling thing. Looking a the article Four Revenue Models and Examples for Small Business http://plantostart.com/revenue-models/ from the website www.plantostart.com this is what they have to say about the Recurring Revenue model...
"The recurring revenue model. It is every entrepreneur's dream, but few will achieve it. It is often the most desired revenue model by businesses of all shapes and sizes. What makes recurring revenue so special? Two words: profit margins and revenue stability. Basically you create something one time, and it sells over and over again."
Now, I have to admit, when applying this idea to CKF, it got a little confusing to me so had to take to the interwebs to get some further clarity on recurring revenue and what that could actually mean for my business. (I found that clarity here... http://www.davemanuel.com/investor-dictionary/recurring-revenues/ ).
DaveManuel.com used these examples that helped clear things up for me...
"Example #1: A software company sells annual licenses for its business software. At last glance, 30,000 different companies were paying for annual license. This would qualify as "recurring revenues" as these revenues will show up year after year.
Example #2: A website owner runs an investment newsletter that charges $19.95 per month. Subscribers are billed automatically every month. This would qualify as "recurring revenue" as the revenues occur again and again, month after month.
Using these concrete examples, I'm going to attempt to apply the Recurring Revenue model to CKF, here goes...
Inspired from Example #1....in 2014, I will be offering licensing to fitness professionals that want to teach CKF. The license structure has four tiers to it: Instructor, Lead Instructor, Advanced Instructor, and Elite Instructor. At the Instructor level, fitness professionals are licensed to teach Cardio Kung Fu. At the Lead Instructor level, fitness professionals are licensed to teach Cardio Kung Fu and either CKF Sculpt or CKF Core. At the Advanced Instructor level, fitness professionals are licensed to teach Cardio Kung Fu, CKF Bootcamp and either CKF Sculpt or CKF Core. At the Elite Instructor level, fitness professionals are licensed to teach every CKF workout. The tiered structure makes it convenient for the fitness professional to advance his/her license as their fitness practice expands. Licenses are renewed on a yearly basis, making licenses a yearly recurring revenue item.
Inspired from Example #2...with a target launch date of November 1, 2013, website memberships will be available that will offer members access to tools to stay on track with their workouts and food plans, an exercise library, progress charts, message boards, and daily messages. Website memberships will be offered for a low monthly fee, making these a recurring revenue item.
I think that's about it for the Recurring Revenue portion of my revenue model. Next up, Transaction Revenue modeling....
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