Whether you’ve been in the IT services industryfrom the beginning or you’ve joined the pack in the past five years, you’ve likely seen some major changes.
You’ve definitely seen evolution in technology and your service offering capabilities. Maybe you’ve noticed greater competition when pitching to potential clients.
What exactly is the state of the MSP marketplace as compared to a few years ago, and what does that mean for the future of your business?
What Has Changed?
The MSP industry is maturing, expanding and changing daily. The number of MSPs offering services has ballooned. The number of vendors available to work with has increased. That isn’t a bad thing. All MSPs, each in their own way, have benefitted from this growth process. What are a few new developments that you’ve benefitted from?
There are new tools and technologies on the market, offering the equipment you need to provide better service to your clients. There’s increased knowledge surrounding these tools, so you’re able to make your team the experts through MSP training. And, with the maturation of technologies and training on their use, your MSP looks a lot different than it did even five or 10 years ago.
But, there’s a flip side to this industry expansion. Today, everyone has access to these new tools, technologies and training materials that you’re using. From seasoned MSPs that have been around the block to start-ups that haven’t yet been in business a full year, you’re facing a wide spectrum of competition.
To the untrained eye of many clients, new MSPs and seasoned MSPs all look the same. They offer the same technology and services. They tell the same story. Customers probably can’t perceive much of a difference. So, what impact does that have on your service offering?
Often, when you’re up against similar MSPs claiming to offer the same value as you, price becomes the client’s deciding factor.And, the newer MSPs usually offer the lower price. This means that thousands of MSPs – more than 75% of the industry – are getting stuck in “the middle of the pack.”
What Hasn’t Changed?
One thing that hasn’t changed is the profit margin for average MSPs. They’re the same as they were five years ago. Selling new monthly recurring revenue at the right price is still the greatest struggle for most MPSs.
All of this is happening while the market opportunity is expanding. Our target market is growing. More companies are willing to outsource IT services than ever before.
So, while average MSPs are staying the average course, top MSPs are reaping the benefits of this expanding marketplace. The top 10% of MSPs are selling more monthly recurring revenue at a higher pricethan any other time in the industry’s history.
It’s a tale of two realities. The market for MSPs is so polarized that there are essentially two types of MSPs: the average ones and the World Class ones.
What Separates World Class MSPs From The Rest?
As we’ve discussed, average MSPs and World Class MSPs have the same tools, the same technology, the same training. The difference is that World Class MSPs possess the five following characteristics:
- They’re active in business planning.
- Their service offering is packaged in a compelling way, and they’re selling it at the right price.
- They’re focused on sales.
- They’re process-driven.
- They have command of their operations.
If you’re an average provider and you’re not hitting the mark of World Class, focus on these five areas. This is where you need to focus your time, money and energy.
You have the power to choose your MSP experience: average or World Class. But, getting to the top requires making changes. With a growing industry and more resources than ever, now is the time to make that change. Don’t wait and get left behind.
Become a World Class MSP with this whitepaper, The 5 Success Secrets to Becoming a World Class MSP.
