Do you profit from all possible ways to earn money with your small business? When you are starting up a small business you probably have an idea which products or services you want to offer to your customers. Basically you should have.
Maybe you have already established your service or products and your small business earns you some money. Don’t you think it would be nice to create some more income from your business by adding further income streams?
In this post I want to show you some potential ways how you can earn some extra money with your business. Maybe not every way works out for your small business and some income ways are hardly to combine. But you should think about one or the other way in order to gain some extra income for you.
For my own business I constantly try to implement a mixture of different basic ways of earning money in order to generate a good mix of possible income sources. Before I tell you more about the way you can add and combine further income sources to your business just let me give you my list of basic ways to earn money with your small business:
My 6 favourite basic ways of earning money with my small business are:
- Project business:
You produce or develop a product for specifically one customer. The best example for a project business is the work of an architect. As an architect you design a house for a client once and in most of the times your business relation ends once the project is finished. This a 1:1 business. One customer, one project and that’s it. You can further differentiate a project business by the way of charging it. The most secure way would be that your customer pays you an hourly rate for the effective amount of time you work on the project. The other way would be to work on the project for a fixed price. This requires a good experience about your working skills and a perfect calculation before the start of the project. Also you need a very good time and project management. For starting your own small business I would not recommend to work on complex projects for a fixed price.
- Bulk business:
This is the complete opposite of the project business. You design or develop a single product which is produced in high quantity. This product is sold to many different customers, which makes it a 1:many business. The advantage of a bulk business is that – unless the product doesn’t need to much capital for research and production – it is more easy to design and manufacture the product. On the other hand it needs more efforts in marketing and advertising because you need to introduce your product to a large number of potential customers. But at first off course you need a good idea for a product itself.
- Retail business:
If you don’t have an idea for a product that you might create, produce and promote yourself, you should think about a retail business. It should be rather easy to find a product or a product range that is interesting for you to buy from a manufacturer and sell it to your potential customers. In this case you probably don’t have to create a complete marketing and advertising around it. You probably will get some support and advertising material from your supplier. This helps you to start your own business more easy.
- Service provider:
Working as a service provider for your customers mostly means to be working on basis of an hourly or daily rate. This can be regular and repetitive work as well as a non regular service.
Offering subscriptions to your customers nowadays will most often refer to some kind of online business or some old fashioned printed newspapers or similar things. You can offer your customers paid access to a website or database with e.g. non public information.
- Affiliates / Paid advertising / Passive income:
This kind of income off course refers to the world of blogging, online stores and e-commerce in general. There are a thousand ways of earning some money on the web through your website or by blogging. Some examples show that it is possible to earn a big bunch of money with it.
Well, one of the mentioned ways probably is or is planned to be your core business which will earn you the biggest part for your income. Once your core business is gaining good results you should try to add one or the other income streams to your business.
Project business as the small business core
The core of my small business is a project business. We prepare special handbooks for our customer in the construction business. The setup process all in all takes between some weeks an several months.
The advantage of a project business is that you have a higher income from each individual project. But, you can’t work on too many projects at a time as every project requires lots of attention.
My tip: Check if you can offer additional services from your project business to your customers. On my project business my customers need updates from time to time. Can you offer updates or additional services to your customers?
Annual publishing or other products as “bulk business”
A second part of my small business income is a series of annual books for the special branch of the construction business I’m in. So at one time every year I publish this annual books. Measured by numbers it is not really a mass business, but we sell a higher number of these books from only one setup.
My tip: Are there any information you can update and publish for your target customers on a regular basis?
Retail business – Which products are interesting for your target customers?
I had my business running for several years with these two different incomes when I thought it might be interesting to add a third way of income. So I decided to add some retail products to my product range.
A nice aspect of a retail business is that you don’t have to develop this products yourself and you can select which products are important for your customers. So I added some specialised books from other publishers to my sales folder which were proven to be very interesting for my customers.
The sales of these books where quite OK, but in the end it didn’t work out in the way I thought it should. For me the difference of earning money and the time for the administration of the sales was not satisfying.
Later on I started my first online shop, retailing equipment for my target customers. My first attempt to enter the e-commerce sector was a complete failure. But not due to a lack of sales. The reason behind it my continuous ambition to do all the things I do as perfect as possible. Due to my project business I couldn’t keep the shop as up to date as it is required. So I’ve closed the shop and focused more on my core business again.
My tip: Can you sell any useful products to your customers that can be combined with your existing service or products?
As long as you’re a one (wo)man show it is very difficult to manage all the ideas and projects you want to start and proceed. When you have your first employee make sure that you start to delegate tasks very consequently. This gives you more space to take care about further projects and to realize new ideas.
Online income for your small business
With my first employee working for me I started to setup a specialised database website for my target customers. This website combines #5 and #6 of my favourite ways of earning money with my small business. On the one hand this website offers a restricted database for visitors which is accessible with an annual subscription only. Those contents of the site that are free available generate some income by pay per click advertising.
The setup of this site took some time and money but now it is running with only less work. It doesn’t earn me a fortune, but it generates a nice income on its own.
My tip: It is not necessary to have a highly professional website to give useful and helpful information to your customers and website visitors. Which information are your customers looking for? What kind of information do they want to have from you? Offer these information online in order to give your customers an additional service.
Providing service based on hourly or daily rates
The last service we added to our portfolio is providing a drafting service for our target customers. With my second employee we had the opportunity to add this service based upon hourly rates. This is currently our best growing income stream.
My tip: You don’t have information your customers are asking for. Why not offering them the research of the missing information?
As you can see it is worth to think about adding different ways of earning money to your small business.
What are your efforts to add further income streams? Which experience have you made with the different ways of earning money? Have I missed any ways of earning money? Please share your thoughts and experience below.