Recurring revenue is the secret to getting more value for your business. You wanna unlock a massive multiple? Build your business around recurring revenue. Gonna tell you why, gonna tell you how, gonna share all that with you in 10 minutes or less on this edition of the Inside BS Show.

Recurring revenue is the key that unlocks the value in your business. Welcome to today's show. We're talking about how you can increase the multiple you receive for your business, and recurring revenue is the key that unlocks all doors in this area.

So if you're in a business that's straight up transactional and you don't know what to do for recurring revenue, find something. White label somebody else's product or service. I was talking to a roofer the other day, and the roofer's killing it.

He's doing really, really well, and he's smart, and he collects all the contact information from his clients, and they love him because he shows up in advance, tells them exactly what to expect, puts a tarp down on the lawn so that when his guys are throwing all the crap off the roof, anything that falls on the grass is not gonna destroy it, and he shows up during the job while his crews are working on the roof, and he asks to speak to the homeowner. He goes at dinnertime or a little after dinnertime and tells the homeowner how the job is progressing. Most of his jobs, if the weather holds out, only last a week, so he's there in and out in five days.

If it rains, he may go into the next week, and you know what his guys do? They take everything down. They don't leave a ladder leaning against the house on Saturday and Sunday so the kids, when they're playing in the yard, can get bonked on the head if it falls over. He is the consummate professional.

He goes above and beyond, provides white glove service, and he says to me, Dave, we're doing really well, but I listen to you talk about recurring revenue all the time, and I don't know how to develop recurring revenue in a roofing business, and I said, well, what are you selling? He's like, what, are you kidding me? He's like, I'm selling a new roof. He's like, there's different types of roofs, and we have three packages we offer, and since I've talked to you, I've also upsold people and moved them up on the priority list if they want to pay a premium, he said, but I don't have, they get a new roof once every 20 years. He said, I don't have a service offering that I can offer them, and I said, no, you're not selling roofs.

You're selling a relationship. So once you have the relationship with the homeowner, what else do they need that you could provide them? He said, I don't have any other businesses. I said, well, if you're working with a homeowner who has a pool, could you potentially white label a pool service? And he's like, what do you mean, white label a pool service? I said, there's gotta be a guy working in that neighborhood doing monthly pool cleaning, and he's in a truck that doesn't have a name or any information on the side of it.

There's dozens that work in my neighborhood. Find two or three of those guys and tell them that you're going to sell their services, and they're gonna give you a 10% discount on their normal service, and you'll upcharge 10%, so you'll make 20%, but they have to adhere to your standards, they have to come on the same day, they have to be neat and clean, and this is gonna be your recurring revenue model. You're gonna offer pool cleaning services.

You could also offer lawn care services, and your job is just to sell these people, and they deliver the service. And he said to me, but doesn't that take away from what I'm currently doing? And I said, not necessarily. I said, you have an office coordinator, an office manager who's coordinating all the services you're currently providing.

All you need to do is teach your office manager how to coordinate pool service too, and as long as the guys show up on the same day at the same time all the time, once you develop the relationship for the roof, you can sell the pool service, or you can sell the landscaping service. These small services are fractured, and they're delivered in a one-off way by people who most of the time don't even have a credit card processing system. So your sophistication in running their back office adds value to their service.

In addition, they're gonna have the opportunity to work on accounts they would never have access to because they don't have your sales ability. So my counsel to this gentleman was to find three different services that he could bundle together, and after delivering great service to the roofer, offer to do window cleaning, exterior window cleaning, which is in South Florida, which is where this roofer was, is necessary at least twice a year because of the mildew buildup on the windows, pressure washing, landscaping, and pool service. The pressure washing and the landscaping can be done by the same people.

Actually, the pressure washing and the window cleaning too could be done by the same people. So he's gonna add those services on a recurring basis to get the monthly revenue from providing those services as a roofer. The key to developing recurring revenue in any business is to remember that you're in the relationship business.

You're not in the business of whatever it is you do. So let's say you already have a recurring revenue model. There are four things you can do to grow your recurring revenue.

So this roofer, once he starts providing pool service and landscaping service, what he's going to do is he's going to have a daily check-in. So every month, their credit card's gonna get billed. What he should do is have his customer service person call 10% of the accounts every month before the credit card is billed.

So everybody's getting a call at least twice a year, once a year, twice a year. That daily renewal check-in, somebody being called every month on a daily basis. So if you have 30 accounts that are renewing, she calls one account every day for 30 days.

If you have 60 accounts that are renewing, she calls two accounts every day for 60 days, just to check in and see how things are going. This renewal call is incredibly valuable because it shows the people whose credit card you're hitting every month that they're more than just a credit card bill, that you really care about them. The second thing you should do as the owner of the company is have your sales reps log one upsell meeting with each of these recurring revenue clients at least every quarter.

Now, an upsell meeting means, since they're paying on a monthly basis anyway, you have three tiers of upsell. And if they get to the third tier, you need to create something else for them to buy. Because you have a relationship with these people, because they're into what you're doing, they will be 10 times more likely to spend more money with you than someone off the street to invest in you in the first place.

So don't waste that opportunity. Have your reps call them and talk to them four times a year to try and upsell them. If you have issues, and the people who are your recurring revenue customers have issues with the service, so if the pool guy doesn't show one week because it's raining, and Mr. Smith goes to jump in his pool and it's all cloudy, and he calls, you gotta send somebody over there that day.

I don't care if it's a Sunday. You get in your car with a bucket of chlorine and you go over there and clean up the pool. So the issues that come up, and there will be issues because businesses have issues all the time, they need to be resolved in the same day.

So you have to have a real-time ticket resolution issue. And then when you have your team meetings or huddles, and you should be having team meetings every morning, either virtually or in person, share a recurring revenue success story every month. Because if you prioritize recurring revenue with your team, your sales team, your operations team, your customer service team, you'll get more of it.

What you focus on expands. So prioritizing recurring revenue and celebrating recurring revenue success in your morning meetings or your huddles is a fantastic way to make sure you get more of that. Recurring revenue is a key to increasing the multiple in your business.

If you want more of it, you gotta focus on it on a daily basis. I gave you four ways to do that today. If you want more just like this, you gotta join me here every day on the Inside B.S. Show.

See you back here again tomorrow.