Passive income is often praised as a strategic way to accumulate extra cash with little labor. Certain types of passive income can even be leveraged to increase cash flow into your business.
This extra money, paired with minimal effort to keep the associated systems running, can go a long way in maximizing your bottom line. If you’re looking to implement a passive income stream to bolster your business, here are 15 tried-and-true ideas on how to do it from the members of Forbes Business Council.
1. Set Up Your Network
By definition, passive income means you are making money by doing nothing or very little. Spending some time to correctly (“correctly” is the key word) set up an affiliate network and partnerships close to the affiliation will usually bring in very good revenue. One of the important things to remember is that your proposal should be attractive over a long period of time. – Gennady Feller, Safe Partner, Inc.
2. Bring Operating Costs In-House
Turn your cost centers into profit centers. Look at what your biggest operating costs are in your business, then see if you can bring it in-house and maybe even charge others for the service. It can be as simple as buying a building versus paying rent and even renting the additional free space. Or, if you deal with shipping logistics, you can set up your own warehouse instead of paying a company for the service. – Daniel Gizzi, Aircraft Executives
3. Monetize Video Content
There is no magic solution to creating passive income, but we are currently in a content-driven world. Start making video content that aligns with your brand and products, and begin posting on TikTok, Instagram Reels, Facebook and YouTube Shorts. These platforms allow you to monetize your profiles and you can even earn some consistent income by creating quality (and preferably evergreen) content. – Myke Metzger, stoqd.co
4. Create A Blog And Sell Advertising
There are several ways to create passive income. Create content or a blog. If your site has reasonable traffic, selling advertising can be effective. Signing up to be an affiliate marketer would also be a high-leverage tool to generate income. – Gordon Smith, Biproxi
5. Incorporate Affiliate Marketing
One of the best ways to create a passive revenue stream is with affiliate marketing. It’s a winning proposition for online content creators like influencers and editorial sites. They can earn long-term passive income through affiliate links naturally incorporated into their content while also continuing to receive commission for any sales driven long after it’s been published. – Adam Ross, Awin
6. Use Business Reserve Funds Wisely
By investing business reserve funds into short-duration treasury securities (which now pay a reasonable income) and then taking a portfolio loan against those securities to buy more fixed short-duration investments, you can essentially generate close to two times the income of a traditional investment portfolio. This can result in a 4 to 6% annual income stream on short-term money. Liquidity risks do apply. – Dana Cornell, Cornell Capital Holdings
7. Source Commissions Via Channel Relationships
One strategy is subletting commercial space; extra space is very common these days. Another is sourcing commissions via channel relationships where the effort is low but the revenue is meaningful. Unfortunately, both still can have issues with collections. Avoid cash flow issues by improving the relationship between income and expenses. Try to use a minimum 3-to-1 ratio between cash and expenses. – David Nugent, Next League
8. Set Up A Membership Community
Setting up a membership community with collateral you have already created is a great way to develop a passive income stream. It is also a sweet way to drip content to your membership so that they get to know your company without a high-priced barrier to service. The hope is that they get to know, like and trust you through the membership and, as a result, purchase a higher-priced package. – Angie Noll, Reconciled Solutions
9. Promote Other Brands On Social Media
A good example of a cash-flow generating, passive income idea is to leverage social media accounts for online advertising once you’ve established your online brand and reputation. Helping promote other brands, giveaways, sweepstakes and partner discounts for per-post charges or via revenue- or profit-sharing arrangements can help you quickly monetize your preexisting digital marketing platforms. – Armand Peri, New Age Public Relations
10. Invest In Mortgages Or Stocks
Streams of passive income can come from investments in a mortgage for a rental income or investment in stocks for dividends. Also, through writing a book, one can enjoy being paid book royalties. – Lere Baale, Business School Netherlands International
11. Create An Evergreen Online Course
Create a course related to your business for people to take online. If you’re in the financial field, you could share stock-picking advice, while a business leader could create a course in entrepreneurship. This is also a great way to reach a broader audience. Make sure to pick a topic that is evergreen. If you have to update the content monthly, it’s no longer passive. – Deyman Doolittle, ShipSigma
12. Team Up With Course Experts As An Affiliate
When the internet emerged as a business tool, a few experts referred to it as your 24/7 “silent” salesperson. Since then, legions of people have learned how to create online educational courses, based on their expertise, and put them online for passive income. Many team up with others (affiliates) in related businesses who advertise the courses and generate passive income from the commission. Powerful! – Jerry Cahn, Age Brilliantly
13. Consign Inventory
Consigning old, unused or slow-moving inventory is an excellent method to generate passive income. Having a consignee warehouse and shipping products for a reasonable fee improves bottom-line profit while also lowering overhead costs. E-commerce has supercharged these fulfillment business models with an ever-increasing demand for products that are bought and sold online. – Joe Faruqui, A.S.A.P Semiconductor
14. Leverage Referral Relationships
Referral relationships are a great way to generate passive income. Your customers are a built-in audience for adjacent products and services, so if you maintain high customer trust, many will gladly heed your recommendations. Many partners will gladly pay someone just for making an introduction. Just remember to choose your partners carefully. Every recommendation reflects on your reputation as well. – Ian Bouchett, Ledgr
15. Don’t Neglect Your Primary Business
Only a handful of business models benefit from passive income. Very few activities that are worth an owner’s time could be considered truly “passive.” If you are focusing on the side hustle, you may miss the opportunities in your primary business, which are likely to make your time more worthwhile. – Annalisa DeMarta, Ridgeline Insights