The goal of every business is to bring in the profits. So, what’s preventing you from making this happen today? In working with MSPs, we hear about a lot of struggles with boosting monthly recurring revenue.
Adding monthly recurring revenue is hard.
I can’t find the balance between competitive prices and prices that are too low.
I expected profit margins to be higher.
Achieving financial independence is harder than I thought.
Do any of these challenges ring a bell? Adding monthly recurring revenue may seem difficult, but it is key to achieving the financial independence and profitability you’re working toward.
Why is selling more monthly recurring revenue so hard to do? It may seem like you can’t sell it consistently. Prospects seem interested, but deals are hard to close. On top of all that, you need to sell your services at the right price.
There is a simple formula to crack the monthly recurring revenue code. Use these three elements to get started.
Having The Right Support Offering
Your support offering is at the center of everything you do. But, many companies are unknowingly making huge mistakes with their MSP service offering. Employ a few tactics to make your service offering more compelling for potential customers.
Focus on the end result. What are you offering your clients? What’s the ideal business result you want to deliver to your customers? You have to charge enough to support the right number of people, the adequate level of technology and the amount of time it takes to work for your customers.
Creating your Super Power – your competitive advantage – helps you separate your business results from the competition. This is the aspect of your company that makes you special, something other companies don’t offer to clients.
Once your support offering is created and includes your Super Power, wrap it up into a specific bundle of services, and commit to providing that to your clients.
Talking To The Right Prospects
You could talk to a dozen prospects a day, but if you’re not talking to the right prospects, you won’t see results. So, who are the right prospects, and how do you reach them?
When you’re assessing prospects, categorize your leads into these three areas:
- Cold leads – These are the companies that may have a slight interest in outsourcing IT services, but they’re not ready to make a commitment or investment. They’re interested in general knowledge about your company and what you offer, but they’re not going to make any concrete decisions. They may come to you via your website or cold calls, but they don’t have an established need yet.
- Warm leads – Leads like these usually come from referrals. They have an actual need and are ready to talk. Warm leads have an interest in your business – and a decent close rate.
- Returning leads – These are the best leads of all. You’ve talked to these prospects before, and they initiate the conversation because they’re ready to buy. You know they’re a perfect fit, but the first time you talked, they weren’t quite at the investment point.
After you’ve categorized your leads, it’s time to determine where you should focus your energy. Work on the leads with the highest likelihood of investment first. The majority of your energy should go to closing warm and returning leads.
Having The Right Conversation
The most important question you’ll get during the MSP sales process is: Why should I spend more on IT services? Most clients already view their IT services as being just fine, so they need to understand the necessity of spending more. When you can answer that question compellingly, you’ll start seeing the effect on your monthly recurring revenue.
So, how do you answer it? You have to help prospects understand the impact of being proactive and reframe their definition of what’s not working in their current IT service process.
Again, your Super Power is an essential part of the conversation. What’s better about your company, and why does it matter? Tailor your conversation to your prospect’s needs and show how you’ll proactively address each one.
When your conversion resonates with your prospects, you’ve mastered the last piece of the monthly recurring revenue puzzle.
Learn more about how to dramatically increase sales and monthly recurring revenue by checking out our free webinar.
