Insights — Channel Creation & New Revenue Streams — 3 min read
Can a Consultancy Create Recurring Revenue?
The 'lumpy' revenue of a project-based consultancy is a major barrier to valuation and stability. Creating a recurring channel is possible, but it requires a change in how you define value.
In short
Yes, a consultancy can create recurring revenue by shifting from project-based outcomes to 'management-based' or 'monitoring-based' value. This is achieved through productised retainers, 'Expert-as-a-Service' models, or subscription-based access to proprietary data or tools. The key is ensuring the recurring fee is linked to a continuous outcome, not just a block of hours.
Consultancy is traditionally the ultimate 'lumpy' business. You win a project, you work hard to deliver it, and then you look up and realise you have no revenue for next month. This 'eat what you kill' cycle is exhausting for founders and makes the business difficult to scale or sell.
Many consultants believe the only way to get recurring revenue is to build a software product (SaaS). While that is one route, it is a high-risk, high-capital path that most consultancies aren't equipped for. A more accessible route is to create a recurring service channel that provides ongoing value without the overhead of building a software company.
The Retainer Trap vs. Genuine Recurring Revenue
Most consultancies think they have recurring revenue because they have 'retainers'. However, most retainers are simply a way for a client to buy a discounted block of hours in advance. This isn't a new channel; it's just a different billing method for the same bespoke work.
Genuine recurring revenue (often called a 'Productised Retainer') delivers a specific, measurable result every month for a fixed fee. The work required to deliver that result should ideally become more efficient over time, allowing the business to improve its margins as the relationship matures.
Three models for recurring consultancy revenue
- Maintenance & Monitoring: The consultancy uses its expertise (and perhaps some simple tools) to monitor a client's status—be it their SEO health, their legal compliance, or their financial performance—and provides a monthly 'fix' or report.
- Expert-as-a-Service (Fractional): A senior expert provides a set number of days per month of strategic guidance. This is highly scalable if the 'expert' is not the founder and the delivery is supported by a standard framework.
- Subscription to Insights: The consultancy packages its proprietary data, research, or methodology into a monthly report or community access that clients pay to receive.
The Drawbacks: Why it's harder than it looks
The biggest risk is 'Scope Creep'. Clients who pay monthly often feel they have a right to unlimited access. If you don't strictly define the boundaries of the recurring service, your margin will be eroded by small, custom requests that 'only take five minutes'.
There is also the risk of 'Value Fade'. If a client pays every month but doesn't feel an immediate benefit, they will eventually cancel. Recurring services must show their value constantly, often through regular reporting or a 'low-friction' win every month.
Evans Sales Consultancy helps project businesses identify which of their capabilities can be turned into a recurring channel. We don't just look for 'more revenue'; we look for revenue that adds to the long-term economic value and stability of the business.
Could your business support another route to revenue?
Evans Channel Creation identifies, validates and builds additional revenue channels from capabilities a business already has — B2B to D2C, D2C to B2B, product to service, recurring revenue or partners — and says so plainly when a channel should not be built. Programme from £1,995 + VAT per month over six months.
Related services