How to Calculate Monthly Recurring Revenue as a Freelancer with Becflow
Learn how to calculate your monthly recurring revenue and grow your freelance business with Becflow's invoicing and payment tools.
You've spent hours pitching a new client, and finally, they agree to a long-term project. But when it comes to payment, you're left wondering when you'll see a steady stream of income. Without a clear plan to calculate your monthly recurring revenue, you're missing out on opportunities to scale your business and increase your earnings. In this post, we'll show you how to calculate your MRR and set your freelance business up for success.
Why this keeps happening
Freelancers often struggle to calculate their monthly recurring revenue because they're not tracking their clients' payment schedules or they're not using a consistent pricing strategy. This can lead to cash flow problems and make it difficult to grow your business. Without a clear understanding of your MRR, you may be leaving money on the table and struggling to make ends meet.
Real example
Take Sarah, a freelance writer who landed a six-month contract with a new client. She was excited to earn a steady income, but she didn't have a clear plan to calculate her MRR. As a result, she struggled to track her clients' payments and ended up with a cash flow problem that made it difficult to invest in her business.
The habits that fix this permanently
These are the non-negotiables for getting paid reliably in your profession:
How to implement this step by step
Step 1: Determine Your Pricing Strategy
Your pricing strategy should be based on your business goals and the value you provide to clients. Consider your costs, expertise, and the value you bring to clients. For example, if you're a freelance writer, you may charge per word or per article. Make sure your pricing strategy is consistent and clear across all clients.
Step 2: Track Client Payment Schedules and Invoices
Use a tool like Becflow to automate invoicing and payment tracking. This will help you stay on top of client payments and ensure you're getting paid on time. Make sure to track all client payments, including deposits, partial payments, and final payments.
Step 3: Use Revenue Recognition Methods
Revenue recognition methods help you accurately calculate your MRR. Consider using the accrual method, which recognizes revenue when earned, rather than when received. This will give you a more accurate picture of your MRR and help you make informed business decisions.
Step 4: Regularly Review and Adjust Your Pricing Strategy
Regularly review your pricing strategy to ensure it aligns with your business goals. Consider factors like inflation, changes in the market, and shifts in client needs. Make adjustments as needed to ensure your pricing strategy remains competitive and effective.
Step 5: Automate Invoicing and Payment Tracking
Use tools like Becflow to automate invoicing and payment tracking. This will save you time and reduce errors, giving you more time to focus on growing your business. Make sure to set up automatic reminders and notifications to ensure clients stay on track with payments.
The Becflow solution
Becflow's invoicing and payment tools help freelancers like you calculate their monthly recurring revenue and grow their business. With AI-powered contracts, payment links, and automatic reminders, you can automate invoicing and payment tracking, freeing up time to focus on high-leverage activities. Sign up for Becflow today and start calculating your MRR with confidence.
Get paid faster, automatically
AI contracts, invoices with payment links, and automatic reminders. All in one place. Free for 7 days.
Start free trial