Steady and predictable revenue that allows us to plan longer holidays or prepare for bigger expenses might seem fanciful to those who focus on selling services. Especially to those in the creator economy who have to accept that feast-or-famine cycle and embrace the uncertainty that comes with it. After all, things can take a sudden turn — a single cancellation can make a huge difference between a good and a bad month.
That’s why it’s prudent to prepare yourself for such situations and have savings always secured. Or better yet, avoid the situation entirely by making your business model self-sufficient enough that you don’t have to lose sleep over your income. To be precise, a recurring service model is what you should be looking for while trying to steady your small business.
But how can you implement a monthly recurring revenue without evolving into SaaS? With the help of productized services, of course.
Productized Services & Recurring Revenue
This combination has the potential to turn your business around. For the better.
Productized service is a way of selling services that resembles selling products; with both fixed scope and pricing, erasing entirely the negotiation part that comes with a fully customized service. Your potential clients can see all your clearly defined offers and be sure of all the terms and conditions that come with them. They can make a quick decision instead of being stuck in the back-and-forth email hell. Such transparency is always way more appreciated and effective in gaining other people’s trust.
Moreover, productized services come in many shapes and sizes. The most popular models are:
- the One–Time Model — where you offer specific, one-time services that can be bought immediately with a set scope, fee, and delivery time,
- the Done-with-You Model — where you offer to share your knowledge, expertise, or blueprints for a specific fee,
- the Unlimited Tasks Subscription Model — where you offer to do unlimited tasks for a monthly fee,
- the Recurring Model — where you offer monthly packages of specific services with a fixed scope.
The first two productized service models are clear one-offs; but the last two work on the subscription basis and, therefore, deserve our attention.
Unlimited Tasks Subscription Model
The unlimited tasks subscription model might seem exploitative — but if you restrict it to smaller tasks and set an upper limit, your customers can enjoy having a dedicated designer they don’t have to employ permanently. This is a perfect solution for those who regularly need specific output yet the number of it changes each month. So if a company has an ongoing content creation, they might need illustrations for their blog posts, written text for social media, or videos to increase customer engagement.
Why would anyone invest in your productized services instead of employing someone in-house?
- Lower costs. Once a business owner decides to work with you, they only have to pay for the output. They don’t have to offer you any benefits, equip you with proper software and hardware, and take care of its maintenance. Also, there are recruitment costs to consider — after all, the process can take a long time and make your team members only busier while they could have been working on their projects.
- Faster results. Again, because of how long the recruitment process can take, you can expect whole months before any work gets done. Instead, they can decide to hop on to your website and make a quick order that will be delivered within days.
- Too little work. Usually, people start hiring when there’s a significant need for a specialist — but what if there’s enough work to be delegated, but not enough for a full-time employee? You either try to push the responsibility to an unsuspecting coworker or you turn to online entrepreneurs who gladly sign up for one-off projects.
- Easier to switch. If you’re not satisfied with the work of your employees, you can fire as many as you need, Elon Musk style. But then you need to fill these roles again and go through the hassle of recruiting new people. While in the case of outsourcing, the contract can be terminated swiftly and signed with another specialist just as fast.
- Find talent across the globe. Despite the reigning trend of remote work, many companies try to go back to the office. As a result, they limit themselves to hiring people in their local area. It might be challenging to find talent that way — but once they look beyond borders, they can find real gems and decide to outsource certain tasks. And that talent could be you!
The Recurring Model is similar enough to the Unlimited Tasks Subscription Model — truth be told, the latter is a type of the former. The only difference lies in the fixed scope. Instead of agreeing on an unlimited number of services, you can offer a specific package each month. If your potential customers know just how much they need in their ongoing content production — for example, four articles per month — such a productized offering could grab their attention.
If you’re afraid that your existing clients aren’t used to such limited offers, you can diversify them as you wish. You can introduce a pricing structure that fits into any budget, use upselling and cross-selling techniques, or offer addons to personalize the service to any heart’s desire. Remember though that giving too much choice might push you back towards a customized service and all the disadvantages that come with it, as well as extend the sales cycle unnecessarily.
Your Own Model!
Of course, these are only two propositions that can be clearly defined. But there’s nothing stopping you from creating your own subscription-based business model, so don’t hold back if you have any ideas. As long as your clients can make sense of what you offer and don’t need to hop on a call to understand it all, you’re safe.
After all, the biggest benefits that stem from productized services is saving time while generating more revenue thanks to streamlined, automated processes. If your business idea doesn’t match that, it seems like you’ve overcomplicated your service, making it no different from a customized services business we want to run away from so desperately.
Seems like an easy task? Not really. Many companies fail at that hard, while others try to disguise their custom solution under a fake productized service costume. If you see a list of described services in detail but then are led to the “schedule a meeting with us!” subpage instead of checkout, you might feel cheated. So be upfront about your services and don’t try to bait potential customers with false transparency.
Recurring Productized Services Examples
To give you a better idea of how recurring productized services can look like, let’s see some examples.
DotYeti is a graphic design platform that can be accessed through a monthly fee. There are three pricing tiers: Basic ($449/mo), Premium ($1,145/mo), and Royal ($2,395/mo). If you agree to pay for 3 or 6 months, the prices will be lower to make long business relationships sweeter. Once you agree to it, you gain access to the platform where you can submit requests. Depending on the plan, you get a designer, designer with illustrator, or a whole team; you can also have one, two, or two projects with a backlog pending, among many other things.
Another example is ContentBacon, a digital marketing firm specializing in creating custom content for businesses. Its subscription-based productized service offering comes in three pricing tiers: Launch ($2,200/mo), Grow ($6,500/mo), and Scale ($10,500/mo). The main difference between them is the number of output: for example, you can choose 4, 8, or 12 blog posts per month or 36, 72, or 108 social media posts. So whether you need moderate or very thorough help, ContentBacon has got you covered.
Last but not least, UnlimitedWP is another great example of a subscription-based productized service model. It’s a white-label WordPress agency offering various services focused on WordPress, from development, optimization, and support. It has three pricing tiers: Starter ($647/mo), Pro ($1297/mo), and Business ($2,597/mo). The main difference lies between the number of hours; you can get 1 – 2, 2 – 4, and 4 – 8 hours of daily work from WordPress specialists.
If you’d like to see other real-life examples of productized services across many industries, from food delivery to marketing firms, read this article and get some inspiration! And if by any chance you’re interested in a productized consulting service, check out this post.
How to Run Your Recurring & Productized Service Business
So now that we know what we’re dealing with and how it looks like in the real world, how can you create your own subscription-based productized service? After all, there’s much to manage; chasing late payments, sending reminders, documenting your work for the client to see, and so on. The struggle that many business owners know perfectly well.
You can of course place your trust in Excel sheets, Notion, Trello, or any other project management tool that comes with low costs but high maintenance. Or maybe you could take a look around SaaS companies and look for the right solution that can handle administrative tasks, finances, and project & team management at the same time. If you have a suitable budget, you can even outsource the development of your own software, specifically tailored to your needs and one-of-a-kind.
It’s especially important if you’re thinking of scaling your own business in the future. The more people you’ll have onboard, the more things to manage, and doing everything manually may lead to costly mistakes. Not to mention, that’s just more time lost on boring, repetitive tasks that make your eyes bleed. Just imagine what you could do with all that time if you could get it back.
And that’s one of the greatest benefits of software — it can really change the way you do business. Most common tools currently available on the market — such as Dubsado, HoneyBook, or Plutio— were created in answer to the growing frustration with the fact that most of our time is swallowed up by the wrong things. It’s bittersweet to discover that you have to issue invoices the whole day instead of letting your creativity flow.
With the help of such a tool, you can set your invoices to be issued automatically along with any reminders. You can also automate sending all sorts of messages, create templates for contracts, proposals, and questionnaires far in advance, as well as create a smooth workflow that brings order into your business. Not to mention, the level of professionalism that it brings attracts more clients who will keep coming back for your top-notch customer experience.
If you have a team, then look for software specifically for improving teamwork, such as Zendo. First and foremost, you’ll need an internal channel for your employees to communicate with, task management that can be assigned to anyone, and other necessary features that make collaboration a breeze.
Is This Business Model for Me?
While introducing subscriptions to your productized services firm could result in many benefits, it’s not a universal answer to how to run your business. There are many different factors to consider that could influence your final decision: from the industry, type of services you offer, your own personal preferences, and your existing clients. If you’re on the fence, remember that you don’t have to overhaul your customized services firm — you can introduce one such service and see how it compares to your existing ones. Or you can offer a new deal to your existing clients, who might view this as special treatment, which is always welcome.
If the results aren’t that great, don’t give up too soon. Gather feedback, change things around, and iterate. It might take some time to find the sweet spot that will suit both you and your clients.
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