Talking to MSPs is what I do. And no matter where I am in the world, or where our MSP partners might be based, the one line of questioning that's common across cultures is around what new services to offer. MSP owners and business executives today are constantly thinking about when and if they should make their next big portfolio move. Is the timing right for managed print? VoIP? IoT?
Each of those offerings likely represents a good opportunity, and the time is now to go all in and become that single source IT provider. Why? To protect and build your business. MSPs need to become managed print, managed voice and managed X companies just to push back. If you don’t own everything in your client’s IT cupboard you’re at risk for competition in your core business. The simple truth is an MSP should expand into new areas to protect their business from the growing list of predators.
Consider the copier market. Copier companies are becoming MSPs. Managed services is a logical extension of the services these sunset companies have been providing for years, so MSPs need to move into the market to keep the competition out.
Get Ready
Regardless of the services added, what do you need to do before making a move? The most important thing to learn is how to price the programs. For managed print, the preferred method is a cost per copy-type basis, which includes all the toner, drums/ cartridges and services, and even the capital component to purchase the device. The customer no longer wants to invest in the capital expense of printers and copiers. Instead, they want to pay a per-device charge to use them similar to any SaaS model.
To understand the nuances of each new service offering that you decide to add, including pricing, get expert guidance – whether it comes from a vendor, a professional community, a new hire, a business partner or an outside consultant. Refer to pricing guides, read up on customer pain points, and talk to out-of-market MSPs about challenges and expectations.
Invest in the Right Tools
As your services portfolio grows, there’s no question that managing your business becomes more complex. The MSP tools you use can make or break your ability to create a profit and effectively and efficiently serve your customers. The challenge is striking a balance between the caliber of tools you know you should invest in, and the amount of money you can afford to pay for those tools within existing profit margins you garner.
The good news is that as the MSP market has evolved, world-class business management capabilities are now moving downstream and becoming more affordable for smaller and less established MSPs. From invoicing, scheduling and ticketing, to remote support, help desk and more, it is now easier than ever to avail yourself of the centralized toolsets that the MSP elite use to serve their clients. Many of these tools can help you deliver your services more efficiently, and standardize the way you run your business to maximize profits and the customer experience. And they’re necessary to operations as you scale and manage your growth.
Speaking of growth, how much incremental revenue can an MSP earn by adding new services? Out the gate, new revenue streams may prove to be somewhat limited. But, as you add more clients and gain more experience over time, the numbers will add up and collectively provide you with the level of recurring revenue that will make your time and investment in the new offering worthwhile.
Most importantly, by expanding your portfolio you’ve done what it takes to keep competitive threats out. Now more than ever, protecting your MSP practice means staking a bigger claim on your client’s IT cupboard -- and overall business objectives and goals. Those MSPs who have been in the market long enough know that services expansion is purely a defensive move.
David Weeks is global channel manager at SolarWinds N-able. Read more SolarWinds N-able blogs here.
