Service revenues are created when selling services (e.g. training, consulting, ..). They are typically driven by Sales Volume (e.g. companies sell services by person days or hours) and a Selling Price (e.g. a day rate or an hourly rate). The Lean-Case Revenue Stream Services bundles a Service specific Revenue Model, the Revenue Forecast Model and revenue related cost models.

Check out the following example to understand the basics of a Service Revenue Model (see figure below):

  • a Business sells Consulting Services to 2 different customer types: Small Customer and Large Customers
  • a Small Customer typically buys a volume of 100 units (e.g. consulting hours) one-time and pays a Selling Price of $10 per unit
  • a Large Customers typically buys a volume of 300 units one-time also paying a Selling Price of $10 per unit  
  • Small Customer make up 40% and large customers make up 60% of all new customers.
  • the Business acquires 10 new customers per month (for the above example: 4 small ones and 6 large ones). 

 

Related Categories 

Follow the links below to dive into more detail on how to create a Service Revenue Stream: