Identifying Your Main Source of Revenue

Whether you are a new business creating a business plan for the first time, a thriving business getting ready to take on new investors, or simply in a position where you are looking to grow, at some point, every business is going to take a long, hard look at their revenue streams.

Revenue streams seem like they would be pretty straight forward. After all, if you have a business or plan on starting one, you probably have a pretty good grasp on where and how you are making your money. But sometimes, it’s not as clear-cut as you might expect.

Multiple Streams

For instance, say you own a corner store where you sell widgets. Your revenue comes from customers coming in to buy widgets. That’s easy. Except, you also take online orders, so there’s an ecommerce element to your business. And you run a successful blog about widgets on your website where you sell advertising space. And you have a wholesale partnership with the megastore Widge-Mart where your widgets are sold at a discount because the order size comes in such large quantities. That’s four different revenue streams that are all coming from your simple little widget business.

Having multiple revenue streams is definitely not a bad thing, but it’s not always a good thing either. When you have multiple revenue streams, it’s important to dig down and determine which source of revenue is the most crucial to your business, which one makes the most efficient use of resources, and which represents the greatest potential for growth.

Benchmarks and Analytics

The best way to dig down into these revenue streams is not to just find that feeling in your gut, or even necessarily to look at which is generating the most cash. Your main source of revenue is going to be the one that is active, consistent, and profitable. Just because a revenue source is bringing in money, doesn’t mean it’s efficient, as you also have to weigh the costs associated with maintaining that revenue stream.

Collecting data and analyzing it over time is going to help tremendously when it comes to making these determinations.

In our widget example above, maybe you find that the advertising on your blog is far and away the most efficient revenue source, but upon further analysis, you may come to realize that the revenue generated from the advertising is only significant for a three month period around the winter holidays every year. So, while that advertising revenue is useful, it might not be the best to focus on year-round.


Once you’ve identified your main source of revenue, that’s the one to focus on, as it will likely represent your greatest potential and the thing you are best at. Having multiple revenue streams can help to provide a feeling of relative safety in case any one stream slows down. But it might also result in spreading resources too thin, and preventing your company from growing and achieving expert status in any single one of those streams. Once you are able to identify and focus in on your main revenue stream, that will represent your best opportunity for growth.

Need help identifying opportunities to grow your business? This is our specialty. Let us help you take your business to the next level. Contact us today!