Regardless of how business and IT leaders view tariffs as economic policy, one certainty is that nearly every organization, including managed service providers (MSPs), will be affected. Many MSPs and the organizations employing them are already scrambling to purchase everything from smartphones to servers before potential price hikes take effect. Additionally, many will reassess their IT strategies. In some cases, this may lead to a reduction in the consumption of managed services as organizations consider workforce adjustments, which in turn reduces the number of endpoints that need management.
In other instances, however, some organizations might also reduce the size of their internal IT teams to rely more on managed services, which can be provided more flexibly as economic conditions change.
Strengthening resilience with a two-prong approach
MSPs should deploy a dual customer strategy. This strategy should focus first on collaborating with existing customers to proactively develop an IT strategy in response to new tariffs. At the same time, MSPs must more aggressively generate new leads for their sales teams to compensate for any potential loss of existing revenue. In short, MSPs need to be more proactive than ever if they hope not just to weather this economic storm but also to thrive. After all, managed services are often countercyclical; when organizations face economic pressure, they tend to seek ways to augment their now smaller internal IT teams.
MSPs are not immune to economic turmoil. Many will need to accelerate automation initiatives to reduce their own costs, leveraging artificial intelligence (AI) to minimize the time and effort required to respond to incidents.
Above all, they must be resilient. It’s unclear to what degree the levied tariffs might be rescinded or increased. Countries around the world are still assessing the impact and their own responses. Some will retaliate, while others will seek trading partners that are not imposing tariffs. Without clarity, most business leaders will proceed with caution in the short term.
Adapting to economic challenges
In the meantime, MSPs should always hope for the best while preparing for the worst. Soon, some MSPs may need to operate with the minimum resources needed to stay viable. It is hoped that reason will prevail so that all parties can avoid a potential economic calamity. However, given the current turmoil on Wall Street, investors are likely to limit the capital they invest in organizations for the foreseeable future as the economic landscape rapidly changes.
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