Quick answer: In business, MRR usually stands for monthly recurring revenue: the money your business earns every month from memberships, subscriptions and retainers. But online, MRR also means master resell rights: buying someone else’s digital product along with the right to resell it, and to sell those rights on to others. The first is something every business should build. The second is something I’d be very careful with. Here’s the difference, and what to do instead.

TL;DR

• Monthly recurring revenue (MRR) is predictable income that repeats every month. It makes a business calmer, more profitable and worth more.
• To work out your MRR, multiply your number of paying monthly customers by what they pay each month.
• Master resell rights (MRR) products are ready-made courses, ebooks or templates you buy and resell. Hundreds of other people often sell the exact same thing.
• Many MRR products are sold with big income promises. Check carefully before you buy, and never repeat promises you can’t prove.
• Your own knowledge, turned into your own product, is worth far more than anyone else’s product with your name on it.

What does MRR stand for? The two meanings

The good MRR: monthly recurring revenue

Monthly recurring revenue is money that comes in every month without you having to make a brand new sale. Think of a gym membership. The gym doesn’t have to sell you again each month. You just keep paying.

Common ways to create it:

• A membership or online community with monthly payments
• A subscription box or software subscription
• A monthly retainer for a service, such as bookkeeping, design or marketing
• A support or maintenance plan on top of something you already sell
• A payment plan, although this ends, so it’s only “recurring” for a while

How to calculate MRR

Multiply the number of customers paying you monthly by the average amount they pay each month. For example, 120 members paying $49 a month gives you an MRR of $5,880.

Times that by 12 and you get your ARR, or annual recurring revenue: $70,560 a year.

Only count money that repeats. Leave out one-off sales, set-up fees and anything a customer pays once.

Jargon buster. ARR is annual recurring revenue (MRR times 12). Churn is the percentage of customers who cancel each month. Net new MRR is the MRR you gained from new customers and upgrades, minus the MRR you lost from cancellations.

Why monthly recurring revenue matters so much

When most of next month’s income is already known, you can plan, hire and invest with confidence. It also makes your business worth more, because buyers pay a premium for predictable income. I explain this in my guide on how to build a million dollar business from day one.

How to add monthly recurring revenue to your business, step by step

1. Find what people need again and again. Questions, support, fresh content, accountability or community are all ongoing needs.
2. Package it as a monthly offer. For example, a one-off course becomes a monthly membership with a live Q&A call and new lessons each month.
3. Set a simple price. One clear monthly price is easier to buy than five options.
4. Take payments automatically so nobody has to send an invoice each month.
5. Give new members a quick win in week one, so they stay.
6. Track your MRR and churn every month.

The bad MRR: what are master resell rights products?

A master resell rights product is a ready-made digital product, such as an ebook, course, template pack or planner, that comes with a licence. The licence lets you sell the product and keep the money. “Master” rights usually also let you sell the resell rights to other people, who can then sell it too.

You’ll also see related terms:

• Resell rights (RR): you can sell the product, but not pass on the rights.
• PLR, or private label rights: you can usually edit the product and put your own name on it.
• White label: a product or service made by one company and sold under another company’s brand.

To be fair, resell rights aren’t illegal, and some people use PLR content as a rough starting point that they then rewrite heavily. My concern is with how MRR bundles are often marketed: as a quick way to make money online with no expertise and no effort.

Why I’d be very careful with MRR products

1. You’re one of hundreds selling the same thing. When everyone has the same product, the only way to compete is on price. That’s a race to the bottom.
2. It isn’t your expertise. You can’t answer customers’ questions confidently about content you didn’t create, and it does nothing to build your reputation.
3. Quality varies wildly. Some bundles are outdated, copied or poorly made, and your name is the one on the receipt.
4. The income promises can get you into trouble. Many MRR products are sold with “make $10K a month” style claims. If you repeat claims like that to your own buyers and can’t back them up, you could be breaching consumer law, such as the Australian Consumer Law or the FTC rules in the United States.
5. The real money often goes to the person at the top. The people who make the most are frequently the ones selling the rights, not the ones reselling the product.

6 red flags to check before you buy

If you still want to buy one, check the licence in writing, search the product name to see how many others sell it, and look up the creator. If you can’t tell who made it, don’t buy it.

The better option: create your own product

You already know things other people will pay to learn. Your experience, your way of explaining things and your stories are the one thing nobody else can resell. And with AI, turning that knowledge into a product is faster than it has ever been.

1. Pick one problem you solve well, for one type of person.
2. Record yourself explaining how you solve it, as if you were talking to a client.
3. Ask your AI to turn the transcript into an outline, such as modules, lessons, worksheets and a checklist.
4. Fill the gaps with your own stories and examples. This is what makes it yours.
5. Sell it once, then turn it into monthly recurring revenue with a membership, community or monthly live calls.

Try this prompt: “Here is a transcript of me explaining how I help my clients. Turn it into an outline for a short online course with 5 modules. For each lesson, give it a title, the one thing the student will be able to do afterwards, and a simple worksheet idea. Use my words and examples wherever you can.”

Frequently asked questions

What does MRR stand for in business?

MRR usually stands for monthly recurring revenue, the money a business earns every month from subscriptions, memberships and retainers. In online marketing, MRR can also mean master resell rights, a licence to resell someone else’s digital product.

How do you calculate MRR?

Multiply the number of customers paying you monthly by the average amount each pays per month. For example, 120 members paying $49 a month is $5,880 MRR. Multiply by 12 to get annual recurring revenue (ARR).

What are MRR products?

MRR products are digital products such as ebooks, courses or templates sold with master resell rights. You can resell the product and also sell the resell rights to others, so many people end up selling the same product.

Are master resell rights legal?

Selling under a genuine resell licence is generally legal. The risk is in how it is marketed. Income claims you cannot back up may breach consumer law, such as the Australian Consumer Law or US FTC rules. Always read the licence and get advice if you are unsure.

What is the difference between MRR and PLR?

Master resell rights (MRR) let you sell a product and its resell rights, usually without changing it. Private label rights (PLR) usually let you edit the product and put your own name on it.

What is a good alternative to MRR products?

Create your own product from your own knowledge, such as a course, membership, template pack or workshop. AI can help you outline and package it quickly, and you can turn it into monthly recurring revenue with a membership.

This article is general education, not legal or financial advice.

Sarah Cordiner is a business and AI educator and the founder of Tekmatix. She has more than 20 years in business, has taught more than 280,000 students in 181 countries, and has been sharing business education online since around 2011.