21f.co/cstore smart contracts+cstores = the future A proposal for the software company: replace annual license fees with upfront tag margins and recurring participation in pricing profits, while targeting lower internal labor costs. Current business Proposed business Sell the ERP suite for $1,000/year. Offer the suite and built-in CRM free. A 10-person company team manages work in a CRM. Sell electronic shelf tags and share pricing gains. Revenue comes from tag sales plus micro-contracts. Revenue comes from software subscriptions. Internal labor-cost reduction target: up to 75%. Company economics per customer location Illustrative terms: $10,000 installed-tag sale, $7,000 direct equipment and installation cost, and a 20% share of verified incremental pricing profit. Tag gross margin is $3,000, or 30%. Software company measure Old model New model Annual software license revenue $1,000 $0 One-time tag sale revenue $0 $10,000 Annual pricing-share revenue $0 $3,186 Total revenue in year one $1,000 $13,186 Year one revenue less direct tag costs* $1,000 $6,186 Recurring annual revenue from year two $1,000 $3,186 Five year cumulative revenue $5,000 $25,932 Five year revenue less direct tag costs* $5,000 $18,932 *Before company payroll, hosting, support, selling costs, financing and taxes. These figures are not net profit. Hardware costs occur once in year one; no repeat tag purchase is assumed. Recurring revenue scales with active locations For an illustrative cohort of 100 locations, annual recurring company revenue rises from $100,000 to $318,645. Year one revenue is $1,318,645, including $1 million of tag sales with $700,000 of direct tag costs. Five year revenue is $2,593,225, versus $500,000 under subscriptions. Internal operating efficiency The software company currently has a 10-person team. The proposal targets up to 75% lower company labor costs. For every $100,000 of annual payroll, achieving that reduction would save $75,000 and leave $25,000 of payroll. Actual savings require validation against workload and service quality. What determines the recurring payment The example assumes each location generates $45/day of genuinely additional sales from otherwise-unsold inventory, less 3% payment fees and no other added costs: $15,932.25/year of incremental profit x 20% = $3,186.45/year for the software company. Micro-contracts need an agreed baseline; existing store profits are not shared. Scenario basis All amounts are USD. Favorable assumptions include 365 days of unchanged results, a full first year of activity, no churn and no tag replacement for five years. The $1,000 license is treated as a per-location fee. Cost and profit-share terms are illustrations, not quotes or measured outcomes. Adoption case Free software and shared, verifiable pricing gains give store clients a reason to adopt. The company earns from the tag margin and its contracted share of those gains.