White Label VoIP Reseller: The Impact of Recurring Revenue

Odd as it may sound, not all revenue is created equal. Revenue that is predictable and consistent can be more valuable and profitable than one-time, big payments. That’s one of the key benefits of being a white label VoIP reseller.

How White Label Works

The market for VoIP services is strong, with global demand expected to reach $140 billion by 2021.

You label the service with your brand and then sell it to your customers. As far as your customers are concerned, the service they are purchasing is yours — not the primary provider’s. However, it’s the primary provider that is responsible for service delivery, maintenance of the system and any upgrades. You have no capital expenses and are only responsible for the internal processes, marketing and other typical business expenses.

Among those internal processes is customer billing. As a reseller, you can bill whatever monthly rate you choose as long as it covers what you pay the primary provider of the VoIP service, and it provides a profit. The result is a predictable monthly revenue stream based on the profit margin you set and the number of customers you have.

Better Forecasting

Among the reasons recurring revenue is so desirable is that it provides you with a better estimate of what you are going to earn in a given year. That allows you to focus more on growing your business instead of acquiring enough one-time sale transactions just to hit previous year revenue levels.

Let’s say your business earned $2 million last year. If 20 percent of that was from recurring revenue and you are maintaining that same client base this year, you know that you can count on $400K in revenue. To meet last year’s numbers, you can build from a baseline of $400K instead of zero which puts you at a completely different starting point. However, if you don’t have recurring revenue, you need to find new sales to account for the entire $2 million — more if you want your business to grow. It’s less work to grow your business if you already have a steady stream of income coming in.

Obviously, there are always a number of factors that come into play that can affect business results. For example, customer churn can be a factor that you may seriously consider when building out your revenue projection model. If so, recurring revenue becomes an even more critical component to building your business.  

Customer Experience Counts

Keep in mind that the “Age of the Customer” can play a significant role as well. Customers don’t just want great deals. They want great experiences, which includes everything from service reliability to technical support. So if you’re going to be successful in reselling a white label VoIP service, it’s important to go with a service — and a service provider — that can help you meet and exceed customer expectations for a great experience.

If you decide to be a white label VoIP reseller, choose a VoIP service provider that has a strong reputation and successful track record in unified communications and in the delivery of VoIP services. Because customer experience is so important, you want a provider that can assure you and your customers of minimal downtime and service disruptions. The service should also be feature-rich and cost competitive, and the provider should constantly be upgrading and enhancing its service offerings. Remember that your label will be on the service, and your customers will see it as “your” service. You want to resell the best service possible to earn customers’ business and their loyalty.

The provider should also have extensive expertise in VoIP technology, which it can impart to you. Because you are labeling the service as yours, you want to be seen as the “expert.” That’s why it’s also essential to partner with a VoIP service provider that offers technical training as well as comprehensive reselling assistance. The provider should also offer an extensive array of tools to help you successfully attract and retain customers.

The Measure of Success

There are a lot of ways to measure business success. For white label VoIP resellers, high levels of recurring revenue is definitely one of those key factors. The better the product or service is that you resell, the higher the level of recurring revenue.