In this episode of Franchise My Business, host Kevin Oldham discusses the significance of recurring revenue in franchising. He highlights the benefits of predictable revenue for business leaders and emphasizes how franchisors naturally have recurring revenue through royalties, making business management enjoyable. Kevin encourages both franchisors and prospective franchisees to consider incorporating recurring revenue models into their businesses. He provides examples of businesses with successful recurring revenue models and acknowledges the challenges in implementing such models in food service. Kevin emphasizes the value of predictability when selling a business and advises prospective franchisees to carefully consider franchises with recurring revenue for better cash flow management.

HIGHLIGHT QUOTES

Building Value through Recurring Revenue in Franchising – Kevin: “The most valuable opportunities, frankly, are the ones that are recurring revenue… It means that somebody else can come in and there’s predictability and people will pay, you know, a higher multiple for that, for that type of predictability in terms of a cash flow stream.”

The Power of Recurring Revenue in Franchising – Kevin: “Recurring for me is, is code for predictable. And as a business leader, I like predictable revenue. And I think that most business leaders would enjoy predictable revenue.”

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HOST: Kevin Oldham

Franchise My Business Podcast