MSP business is generally going to be a better proposition in today’s marketplace than going the VAR (value added reseller) route, and there are a number of reasons why. As a VAR, you provide products and services that are available elsewhere, but have been enhanced for clients. Basically, you’re handing your clients turn-key IT services. Ultimately you’ll end up working with fewer clients as a result, and the cost involved in adding the value which defines your operations already results in a thin profit margin. But as demand has increased, the market has shifted, and VARs are quickly being choked out. This is especially true when you consider the changes that the Internet of Things and cloud computing bring to the table.
Meanwhile, a managed service provider essentially functions as an outsourced IT department for a company. You advise— and often source— software and hardware solutions for clients, but you additionally assist in the installation, maintenance, and troubleshooting of those systems. If done right, a company eventually looks at an MSP as part of their organization— if subconsciously. This almost never happens with a VAR, who will be abandoned in an instant should a better deal be found.
Becoming Closer With Clients
With an MSP, you represent an integral component of functionality for your clients. You’d really have to make some big mistakes for them to just cut you off. Generally, the transition is more costly and time-consuming. Once a company chooses an MSP, they’re likely to stay with that MSP.
Additionally, many MSPs provide cloud computing solutions and other cost-effective and innovative technology fixes which bring clients the same value as traditional systems while saving them money. New tech innovations like the cloud require training, and you can bill for that. You can also add a bevy of services like BDR, proactive management and monitoring, and cutting edge security. An MSP business doing things like this for clients is almost partnered with them, and as your relationship continues to develop, dependency continues to increase.
Successful Businesses Expand
Businesses that are successful have many customers and are continuously expanding. Today, that often means technology necessity increases as the business does. Just consider the proliferation of IoT devices right now. Some experts say that by 2020, there will be approximately 30 billion IoT devices globally. That’s almost four devices per person on the planet. There is definitely going to be troubleshooting going on, and MSPs are in a good position to succeed. This trend is increasing because, through the cloud, IoT is able to yield substantial data and convenience to those who employ it. A VAR can only collect, basically, one check from a turnkey data-collecting operation via IoT. But an MSP can sell the devices, install them, maintain them, troubleshoot them, and upgrade them. Additionally, an MSP will be able to provide:
- Mobile device management and security in the workplace
- Connectivity that is seamless between mission-critical networks and IP devices
- Complexity management of IT systems, decreasing client stress
Successful MSP Operations
To be successful as an MSP, there are several basic things you’re going to have to do. You’ll want automated management that is remote and provides monitoring support. Most issues can actually be handled remotely today, so this is fundamental. You’ll want service offerings that are modular, and silhouette a licensing model that is flexible. These things must be cohesively harmonized under a strategy that plans ahead. The transformation will happen as your MSP grows, and that means you need to be prepared to scale up as necessary in scope, service, and the kind of clients you source. Lastly, you want a helpdesk that isn’t merely icing on the cake, but functions as the “meat” of your operation.
Certainly, some VARs are doing better than others and you may not need to make any switch at all. But if you think about MSP operations as the next step up the operational food chain, you can have your cake and eat it too. MSP business still sells software and hardware that often has value-added. Acting as a sort of IT surrogate for clients represents a very natural transition.