Tamarack Outfitters launches a $29-a-month gear-rental subscription. Compared with its store sales, the subscription revenue is:

Answer

Recurring, and more predictable because of the forward commitment

Options - A. Recurring, and more predictable because of the forward commitment - B. Transactional, because each monthly charge is a separate sale to the customer - C. Recurring, and riskier because a subscriber can cancel at any time - D. Neither; rental income is a financing stream, not revenue Why - A. Correct — a subscriber who has not cancelled is far more likely to pay next month than a walk-in customer is to return; that predictability is what earns recurring revenue a higher multiple. - B. A monthly charge under a standing subscription is the definition of recurring revenue. - C. Cancellation is a risk, but recurring revenue is LESS risky than transactional revenue, which must be re-won every time. - D. Rental of equipment in the ordinary course of business is operating revenue.

Bigel ch 8; the nine-block business model canvas (Osterwalder), described not reproduced