Dealers and resellers looking for new revenue sources or enhanced margins should consider selling managed services. There is strong demand in the SMB market for outsourced services such as help desk, application hosting, network operations, or remote monitoring and management.
It will take a significant investment and commitment to be successful with managed services, but the reward may outweigh the risk. Here are eight reasons why you should consider managed services:
1. Deeper customer engagement and loyalty. Selling managed services makes you more of a strategic partner with your customers than just an equipment supplier. You work with them to build an IT infrastructure that will enable them to meet their goals. That means more revenue from each customer and greater incentive for them to stay with you.
2. Competitive advantage. This is another benefit of deeper customer loyalty. If you manage a company’s IT infrastructure, it’s much harder for a competitor to get a foothold there. For new business, you have more than just printers and copiers to talk about.
3. Stronger story for recruiting. The best sales people, technical staff, and marketing experts will look for companies that have strong avenues for growth. Managed services is growing, while the equipment business is flat.
4. You don’t have to start from scratch. Several well-established companies like Continuum and Collabrance provide platforms and services that allow dealers and resellers to quickly build their managed services business. They provide services such as call center support, training, and business planning resources.
5. Enhanced company valuation. Managed services provides contracted renewable income, which banks and investors like to see should you need money to expand. Dealers that sell managed services tend to sell for more money when acquired than dealers who don’t.
6. Diversification. When equipment and supplies sales don’t perform, having a steady renewable revenue stream from managed services can be comforting. Since managed services encompasses a wide range of potential offerings, you have more opportunities to grow depending on where the most demand lies.
7. New business. It’s common to hear dealers tell stories of landing new equipment business because they offered managed services. For example, they land a managed service account at a company that gets its printers and copiers from a competitor. As they build trust with that customer, adding the equipment business becomes an easy conversation for the sales reps.
8. Demand is high. There are many businesses with 10 to 100 users with no internal IT resources that feel like their growth is being held back due to their IT infrastructure, or lack thereof. Dealers report that it’s easy to qualify prospects that depend on their IT and will value partner-provided services.
