Your MSP business can’t simply throw a price out there without doing the footwork beforehand. Well, it can, but this is going to undermine operational effectiveness. Such practice either puts services out there at levels too cheap to sustain or too expensive to maintain. There is a distinct balance in pricing, and if you’re going to set yours the best, there are some best practices to consider:
Carefully Examine the Market to Determine Thresholds and Competition
Your MSP business needs to look at what the market will sustain. What are you already charging existing clients for similar services? What are competitors charging? What will the market bear? Consultation can be key. Do you know any groups specializing in facilitating such infrastructural solutions for tech agencies?
SEO and other marketing operations can help you know what you can “get away with”, as it were. If you know what competitors are charging, you can undercut them, should that be affordable. Strategies like these help determine what to sell products and services at.
Determine Operational Expenses and Focus on PR
How much does it cost you to do what you do? You’ve got space costs, personnel costs, taxation, management of on-site data centers, marketing, and PR to consider. Public relations can help make you more sympathetic to the clients you’re seeking to reach.
People will pay more if they feel like this is the right thing to do. If you can make them comfortable with your business, you may be able to charge more based simply on the well-branded, dependable service you provide.
Acquire Appropriate Feedback
What are other, similar businesses doing? What are your existing clients saying? When you go to conventions, what kind of feedback can you get? Answering questions like these can help you determine where you really are in terms of pricing and where you should be. Sometimes you’re charging the right price, and you get negative feedback. This is why feedback in and of itself shouldn’t be the only determining agent in how you price the products or services you provide.
Definitely, you need to know what markets will sustain, what costs of operations are, and how the market presently perceives your MSP. With all this information combined, feedback can help you determine if you need to trend in one direction or another. If you don’t have a method in place for collecting such information, designing such feedback recouping mechanisms is likely necessary.
Use Strategically-Gathered Information to Set the Best Prices
Your MSP business should carefully examine market thresholds as compared to competitor prices, work to obtain effective PR as balanced against operational expenses, and acquire operational feedback from clients as well as industry professionals. These practices should provide requisite information to set the best prices for products and services.