So what are the revenues? What is the benefit of knowing it? What are their sources? How is it calculated? What is the difference between it and pricing? Is there a difference between revenue and revenue and the other?
Revenue is the income generated by the enterprise through its economic activity, from the sources from which money flows in the project and may be one or several sources, and what results from an increase in the company’s assets or a decrease in its obligations
Benefit of knowing revenue sources:
The revenue sources will show you your monthly and yearly income and you will now know how much your minimum income from your project must be to cover all expenses and calculate your interest, from here you can start developing your marketing plan, and will also determine the necessary budget for marketing until you reach the minimum sales level that guarantees your project’s success.
The most important sources of revenue in commercial projects:
• Selling: known from ancient times, your product might be like a cup of coffee
• Ads: The service may be free and make your profits from ads with well-known companies such as Google and YouTube.
• Commission sales: Your revenue sources may be by selling third party products either hand in hand or over the Internet and earning your commission for every sale such as the Haraj app
• Add-on fees: Your services or products may be free and earn money as revenue sources only by selling add-ons or accessories to your original product. As is the case in some mobile games where you download the game for free, then if you want more benefits, you have to pay for those features, such as Bebaji.
• Subscription fees: that customers pay monthly subscriptions in exchange for using your existing equipment or services provided, and this type of revenue is more popular in service projects such as sports clubs.
• Usage Fee: The source of your revenues may be according to the consumption of customers, for example telecommunications companies pay their customers according to their consumption of the company’s services.
• Leasing: by taking a certain fee for renting a commodity for a certain period, such as car rental offices.
• Profit sharing: You may provide your services to your customers and earn money when they win. For example, they are an independent site that takes a certain amount for each complete process the customer performs.
How are revenue calculated?
Revenue is calculated by multiplying the price at which the goods or services are sold by the number of units sold or the service provided, and is also known as sales in the income statement.
The difference between revenue sources and pricing:
Sources of revenue: This is the strategy that the company will define to earn money from each category it targets
While pricing: are the tactics that you use to set the price for each target group
In other words, you choose the source or sources of revenue, and then you determine for each source the appropriate price or prices
The team between revenue and other income:
Other income, which is all revenues that the company generates, but is not part of its main activity. For example, the company that sells machinery has achieved interest income as a result of the process of linking deposits with a bank, and this type of revenue is classified among other income in the income statement.