How To Fiscally Prepare For Tough Times Ahead
By Kathy Wagner, Kaseya
We all watch the news and know some tough economic times are ahead. The good news for managed service providers (MSPs) is that with the digital transformation in full force, small to midsize businesses (SMBs) will continue to rely on your services to manage their IT environments. With that said, it’s always good to look out for your customers and save them money while also looking out for your own bottom line. Here are some tips to help you manage the anticipated economic downturn.
Improve Efficiency With Technology
Look at how technology can make you more efficient and leverage affordable platform solutions. We all know the challenges MSPs face – vendor fatigue, lack of technician efficiency, limited software utilization, and tight software budgets. On top of that, MSPs are becoming increasingly sophisticated, with two-thirds of them now having dedicated resources for sales and marketing. Customers are shopping around for deals, and you have more competition.
Instead of investing in multiple solutions that have features and functionalities that will go unused, opt for platform solutions that are less costly and provide only what you need. With that, you can avoid the overhead associated with integrations, vendor management, and employee training, and it allows you to also leverage volume discounts.
Audit Your Business
This may seem like a no-brainer, but like most MSPs, you probably struggle with finding the time to just sit down and review items line by line. Some solutions help you audit inventory and analyze your tech stack to identify cost-saving opportunities to fuel your profits. What should this type of review entail? First, it should look at what you currently have and then analyze how you’re consuming the products. This will help identify what you truly need, and also provide the opportunity to lean down your vendors and put a transition plan into place that will help you move to a platform of solutions that not only saves you money, but also makes life easier for you through offerings like automation, and a single pane of glass where you can access all your tools from one place. Finally, consider products that can make you money while you sleep by providing services that run themselves versus needing staff time.
Help Customers Lean Into Technology
Look at ways that you can help your customers become more efficient by embracing technology. Tasks like appointment setting, ordering, and even online classes can help your customers save time and money. For example, if a customer has online ordering, it means they have less overhead. If you are providing and managing this technology to your customers, that broadens your reach and empowers you to be more profitable – you’re not only holding down your business, but you’re also growing it.
Get An Edge Over The Competition
According to the Datto Global State of the MSP Report, MSPs are losing sleep over competition, revenue growth, and profitability, among other worries. In fact, MSPs ranked competition as their top challenge. Savvy customers are doing their homework to find the best prices, and MSPs have had to evolve to keep pace with the cutthroat competition. What’s an MSP to do? For starters, you need to keep the customers you have happy. Don’t assume everything is fine because you don’t hear from them. It’s important to do regular check-ins with them to nurture the relationship so they value you as true partners in their business. Additionally, you need to look for opportunities to secure new customers. There are sales enablement tools that can help support this endeavor through MDF funds, coaching and even providing marketing materials to help you secure new business. It's hard to go after new customers when you’re busy running the day-to-day, but there is help through programs such as Powered Services and TruPeer. And finally, acquiring an MSP who may not be fairing so well is another way to immediately increase your customer database.
Yes, there may be tough economic times looming, but there are many actions you can take to weather the storm, from using technology to increase efficiency for you and your customers, to taking a hard look at your business to see where you can save. These tasks may seem daunting, but there are solutions designed to help you do them so that you don’t get knocked out by the competition.
About The Author
Kathy Wagner is Chief Financial Officer of Kaseya.