ON THE HORIZON
CRITICAL STEPS
To Drive Higher Margins For Your MSP Business
As an MSP , you provide invaluable benefits to your customers , yet far too often , you ’ re leaving money on the table . At every stage of the client life cycle , there are critical steps that , when taken , can maximize the value of each opportunity .
From the top of the sales funnel down to the nitty-gritty details of implementation , we ’ ve identified key chances for MSPs to generate additional revenue and improve their operational efficiency to increase margins .
HELPING MSPS TO
MORE
Close More Business Offer More Services Keep More Customers
Communicating Value And Expanding Repertoires
MSPs can do a lot of things for their clients , most of which can ’ t be replicated with their own homegrown talent and resources . But it ’ s quite common for MSPs to undersell the magnitude of the benefits their services bring to the table .
To an MSP , these services might feel like a commodity , which drives some to undervalue and underprice what they ’ re pitching to prospects . But high-performing MSPs are separating themselves from the pack by continually adding new services .
When it comes to IT services outsourcing , the vast majority of customers want one-stop shopping . They need a trusted partner that views their systems holistically , not just a collection of point solutions operating in a vacuum . An MSP that can advise customers on what they need today and tomorrow is essential given the complexity of an ever-shifting IT landscape .
This begins with the language MSPs use to position themselves . MSPs limiting themselves to specific technical areas and simply reacting to customer requests — versus proactively exploring all possibilities — are selling themselves short when articulating their value proposition .
The Art Of The Cross-Sell
It typically costs about 125 % to 150 % of a customer ’ s monthly recurring revenue ( MRR ) to close an initial deal , factoring in the various sales and marketing expenses . That ’ s why MSPs fight so hard to keep their existing customers happy .
In the software industry , it ’ s standard practice to lure in new customers with a particular product or service . Then , once customers are in the fold , businesses increase each client ’ s value by continually pushing them to purchase additional offerings .
But for whatever reason , this is usually not the case with MSPs that often do not have a strong sales culture within their organization . Instead , most MSPs work very hard to cram as many services as possible into the initial deal , then move on to other prospects once that deal is closed . This leaves a tremendous amount of revenue on the table .