For today’s value added resellers, or VARs, it’s no secret that pricing solutions has become more competitive than ever. As a result, more and more VARs are looking for new ways to generate revenue. Many have found that delivering managed IT services offers them a massive opportunity to achieve this. Transitioning to a managed service provider (MSP) model requires the ongoing monitoring of customers’ IT environments, and with that ongoing service comes a monthly fee, or monthly recurring revenue (MRR).
Jumping from a one time transaction model to managed services may seem like a challenge, but it won’t take long to see how the benefits of an MSP model will pay off – literally. If you’re thinking about making the switch an MSP model, here are two tips to consider along the way:
Craft a Clear Pitch: When you’re first making the transition, start by pitching to your clients who you’re currently doing a lot of business with. Begin by showing them how much they’re spending annually, and then show them how much they could be saving with a subscription model. It’s important for both you and the client to realize that there’s no crystal ball when it comes to IT services. Neither of you know when the client will need to buy a service or ask for a quick fix. Actively monitoring their IT environments keeps them up and running at all times, and promises you monthly recurring revenue.
If you’re going after completely new clients, another approach would be to offer a trial period. You can still make the case for a subscription model, and highlight how managed services can take away the uncertainty of having to buy various products and services throughout the year. The trial period offers new clients some time to understand the value behind they’re service you’re providing and help to nurture a trusting business relationship.
Choosing Your Tools: In addition to mastering the pitch, you’ll also need new technologies to help you deliver on your managed service initiatives. Remote monitoring and management (RMM) and professional services automation tools are considered essential to properly deliver managed IT services. RMM tools are designed to monitor your clients’ IT systems and report on performance. RMM software also allows you to remotely trigger management tasks—such as patching or other software updates. PSA software is designed to keep track of client projects. As an MSP, these tools are essential to give your clients exceptional service.
RMM and PSA tools integrate with a variety of technologies including desktop and server management software, backup and disaster recovery technologies, storage management tools, and antivirus software. If your clients are using technologies that offer integration, you’ll be able to better serve their needs and offer an improved overall experience.
With your pitch perfected and the tools you’re offering are aligned, you’re in a good place to kick things off as an MSP. Remember, the services you’re offering to clients can be equally beneficial for both parties, and technologies that offer integrations will help you function as a well-oiled MSP machine. If you’re interested in learning more about making the switch from a value added reseller model to a managed IT services model, check out the following eBook: From VAR to MSP.
Eric Torres is channel development manager at Datto Inc. Read more Datto blogs here.