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MSP obstaclesEvery IT service business is a work in progress, whether you’re a new MSP just getting started, a VAR transitioning to an MSP model, or a veteran IT service provider. At any given moment, you can probably think of a few processes you’d like to streamline to help your operations run more smoothly or metrics you’d like to improve to make your MSP more profitable.

Or, maybe you’re not quite sure what you need to fix. You just know you aren’t seeing the results you’re aiming for, and you want to figure out how to improve.

To help you assess what’s working and what’s not, let’s look at some common MSP stumbling blocks that could be holding you back:

1. Business Planning

If you want to keep your business on track, you need to know where you’re headed, and that means you need a plan. Having a few vague goals in your head isn’t enough. Take the time to create a business plan that spells out what your objectives are and the actions you need to take to achieve those goals. Draft up a one-page plan that you can reference throughout the year and easily share with your team.

2. Measurement

A business plan alone isn’t won’t help your MSP succeed. Your business plan should help you identify the key performance indicators that matter the most for your business. Then, you need to track your performance in those areas regularly, so you know if you’re on track to meet those goals or if you need to make adjustments along the way. You can’t fix what you don’t measure.

3. Pricing and Packaging

The way you price and package your managed service offering can make or break your business. If you price your services too low, it will be more difficult for you to operate profitably. But, if you price them to high you might feel like you’re losing out on business. Packaging can be just as critical. The right approach to packaging will make your services easier to understand and sell, and a flawed approach to packaging will cause confusion, for both you and your customers.

4. Positioning

Do you have a unique selling proposition? Odds are you don’t. Most IT service providers don’t know—or can’t articulate—what sets them apart from their competition. And if you can’t explain to potential customers what makes your MSP better and why working with you is more valuable that working with their current provider, you’re going to have trouble closing new business. Figure out what unique value you provide to your customers and position your MSP accordingly. It will help you win more business and command higher prices.

5. Marketing

Marketing has been a weak spot for many MSPs for a long time. For many MSP business owners, marketing is outside their comfort zone, or they simply don’t have time to think about it. As a result, MSPs often ignore marketing all together, only make a half-hearted effort, or give up too soon. It’s probably time to take an honest look at your marketing (or lack thereof).

6. Prospecting

Many MSPs rely heavily on referrals a source of new business, and they don’t take the time to develop a prospecting engine that will keep their pipeline full. Taking a more balanced approach to prospecting that incorporates cold calling, drip marketing campaigns, and networking, will help you build a more consistent and reliable source of new business.

7. Sales

The MSP sales process isn’t a fix-it-and-forget-it proposition. You need to have a sales focus and make sure you’re setting your sales team up for success. Do they have the proper training, and have you put the right incentives and quotas in place to keep them motivated? You should also have a process in place to review sales activities each week.

8. Customer Retention

Customer turnover could be making it difficult for you to see the progress and improvement that you want for your business. According to the State of North America Managed Services report by The 2112 Group and Barracuda MSP, the average MSP loses two accounts per month. That amount of customer churn can put pressure on you to bring in new accounts simply to maintain the status quo. But, it might be more effective to consider dedicating more resources to improving customer retention, instead.

Another resource to help you overcome MSP obstacles

To help you overcome more MSP obstacles, Gary Pica, president of TruMethods, has identified four areas of focus that can have a significant impact on MSP success if you get them right. In the new e-book, The TruMethods MSP Improvement Plan: 4 Areas You Need to Fix to Find MSP Success, Gary takes a closer look at those four key areas and how you can take action to improve in a measurable way.

Photo: Pavel1964/

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Anne Campbell

Posted by Anne Campbell

Anne Campbell is the public relations manager for Barracuda. She's been with the organization since 2014, working on content and public relations for Barracuda MSP, the MSP-dedicated business unit of Barracuda. She started her career in newspaper and magazine journalism, and she brings that editorial point of view the work she does, using it to help craft compelling stories.

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