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How to innovate for additional income streams

How to innovate for additional income streams

It’s important to ensure your core business is developed thoroughly before you start focusing on additional income streams. However, a business owner should always be ambitious and seek new sources of growth

Have you ever heard the saying ‘don’t put all your eggs in one basket’? If so, you’ll understand that you should never concentrate all your efforts and resources into one area. This phrase translates perfectly to running a business, as you should never rely solely on one income stream. Rich Elms, MD and founder of BabyBallers, a football and multi-skills children’s franchise, has developed a range of additional income streams to ensure BabyBallers’ franchisees have supplementary income to their class subscriptions. Rich shares his advice on innovating for additional income streams.

There are many benefits to creating additional income streams for your business. Not only can you achieve greater financial stability, but you will also be able to scale faster and explore your creative side. Of course, it’s important to ensure your core business is developed thoroughly before you start focusing on additional income streams. However, a business owner should always be ambitious and seek new sources of growth. At BabyBallers, we offer great additional income streams that bring exposure for franchisees to reach clients they may not have reached by just providing classes.

Focus on adding value to your customer base
The first thing to do when innovating for a new revenue stream is to brainstorm the practical ways you can add value to your customer base. Remember, customers’ needs are constantly evolving, so your products and offerings should be too. When deciding how to add value to your services, start by asking yourself, “How well are we currently meeting the needs of existing customers?” and “How can we make our services more valuable to our customers?”.

Adding value could be anything from improving the packaging or the design of your products to simplifying how someone can use your product or service. For example, if you own a restaurant franchise, you could offer free local delivery or special offers for repeat customers. Creating these additional services and products that add value to your customers won’t just help you increase a customer’s satisfaction with your brand, they’ll also enable you to generate more income - which is exactly what you want if you’re creating additional revenue streams.

Listen to your clients
The only way to find out what your customers genuinely need is by speaking to them. Whether your business is B2C or B2B, if you want people to buy your products - and keep buying them - you need to find out what they want. Open up a communication line with your customers and connect with them through your various online and personal platforms. Or you could do it the good old-fashioned way and ask them face-to-face!

Many of BabyBallers’ additional products have evolved through conversations we’ve had with our customers. For example, from October we will be providing entertainment at kids’ birthday parties because of conversations we’ve had with parents who attend our classes. Due to the significant number of enquiries we received, it was clear there was a market to provide this additional service. We also offer a range of branded merchandise, such as kits, toys, footballs and scooters for parents to buy their children. These additional products create a sense of belonging to our team and mean that the kids can practice and keep active at home.

Turning ideas into reality
Once you’ve talked to your customers and established what can add value to your services, the next step is to plan your development process. Creating a development process starts by putting in place a timeline of events to follow. This will help you complete the process in a timely, cost-effective manner. Next, estimate the resources you’ll need. This will give you an idea of the types of resource strains you can anticipate throughout the project. It will also serve as the basis for developing a budget for your development efforts. Finally, establish a budget. Budgeting your resources (time, money and people) will allow you to maintain fiscal responsibility during the development process. Personally, I would recommend planning your development process before you become too attached to a product. Why? Because if you fall in love with a new idea before you have a development plan, you may make poor business decisions as you work through the development process.

Once you’ve completed the development process and released your additional products, arrange times to review your revenue streams and remove the ones that are not performing – this will save you both time and money if something simply isn’t working. To do this, track the product’s sales, market share, profit or loss and all other key measures once it’s released.

It’s clear that developing additional income streams can be a great way to pivot when other income streams aren’t performing as well. But to ensure they don’t become a time-consuming and expensive ordeal, you need to understand what your customers want. So, whether you’re looking to repackage and repurpose existing services to better suit your clients’ needs or if you’re looking to expand your product offerings, following this advice will help you develop additional income streams that will help your franchise flourish.

The author
Having launched a franchise to fulfil his son’s passion for football, Rich Elms is now the franchisor and founder of BabyBallers, a football and multi-skills children’s franchise that offers football and sporting development activities to children between the ages of 16 months to five years. Since its launch five years ago, BabyBallers franchisees have opened over 50 clubs in the UK, and the concept has expanded to Belgium and Australia.

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