How to Grow Your Managed IT Services Business

Offering managed services presents a lucrative opportunity for IT companies to build recurring revenue through reliable, long-term client relationships.

However, standing out in this competitive market and demonstrating ongoing value requires strategic thinking.

This article explores proven tips on how to grow your managed IT services business. Have an inside scoop on the growth and scale of your offerings.

Table of Contents

Define Your Offerings:

The first step is outlining your core managed services and ideal customer profiles.

Common managed IT services include:

Managed cloud hosting and storage
Backup and disaster recovery
Cybersecurity services like firewall monitoring
Desktop and helpdesk support
Network and infrastructure management
Business continuity planning
Compliance and regulatory auditing
Project management

But avoid becoming a jack-of-all-trades. Consider your in-house expertise and strengths to hone your niche. Becoming renowned for specialized managed services makes you a go-to provider.

When defining offerings, detail service tiers too – such as basic, pro, enterprise – with clear deliverables. This structures pricing plans while meeting diverse client needs.

Refine Your Sales Process

With defined services, the sales process should educate clients on the benefits of managed services to spur conversions.

Highlight pain points managed services alleviate around IT headaches, overhead and risks.
Conduct ROI analyses quantifying hard and soft dollar savings.
Offer free network/security audits exposing needs a managed plan can address.
Make the buying journey easy with online content and clear pricing.
Leverage client testimonials to substantiate credibility.

Ongoing nurturing via content, webinars and events also warms prospects for future sales cycles.

Focus on Retention

The managed services model only succeeds through retaining happy clients over time. Supporting customers and continually proving value should be top priorities.

Structure contracts to renew automatically unless cancelled. This passive income is the lifeblood of managed services.
Send customer satisfaction surveys periodically to identify issues early.
Appoint client advocates responsible for direct, ongoing communication.
Host quarterly business reviews to showcase deliverables.
Rely on change management processes for major upgrades or migrations.
Incentivize renewals via loyalty tiers that increase service levels.

High retention translates directly into recurring revenue and referral opportunities.

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Refine Internal Processes

Growing managed services requires optimizing internal systems and staffing models to profitably deliver and scale.

Standardize operating procedures for consistency across technicians and accounts.
Institute key performance metrics around client satisfaction, ticket resolution times and uptime.
Automate tasks like monitoring, alerting and reporting to increase efficiency.
Hire dedicated account managers separate from technical delivery roles.
Train staff on customer-focused skills like communication, documentation and expectation management.

With efficient workflows, your team can handle more managed services revenue without compromise.

Make Pricing Profitable

Pricing managed services can be tricky, but taking a business-minded approach is key.

Calculate your true overhead costs factoring in labor, tools, training and management.
Determine reasonable margins based on the value delivered rather than just competitive rates.
Offer tiered plans that appeal to different budget levels.
Use flat-rate monthly billing versus per-device or hourly to stabilize cash flow.
Increase rates annually to account for rising business costs.
Maintain minimum contract values that balance profitability with entry-level access.

Profitable pricing enables reinvesting in growth while staying affordable.

Differentiate Through Specialization

Competing on price alone is unsustainable. Develop unique intellectual property around your specialized services.

Create proprietary frameworks, methodologies or risk models.
Invest in advanced software tools specific to your niche.
Pursue industry-recognized certifications and accreditations.
Formally document your processes and best practices.
Identify emerging technologies to stay ahead of the curve.
Publish thought leadership content on your website and social media.

This expertise elevates your authority status over generalist providers.

Technology

Capitalizing on technology creates efficiencies while meeting client expectations.

Use RMM/PSA software to unify and automate service delivery tasks.
Offer client portals with dashboards of device health, tickets and reports.
Implement self-service capabilities like remote access, password resets and documentation.
Integrate monitoring, alerting and ticketing with clients’ existing systems.
Leverage chatbots for faster response times.
Adopt digital signature/payment tools for seamless contracting.

Technology demonstrating commitment to a smoother client experience will lead to see your quest ‘’ how to grow your managed IT services business’’ more clearly.

Expand with Caution

Balancing growth with quality requires judicious expansion and investment:

Only scale when current processes, staff and infrastructure have capacity.
Hire slowly and selectively. Train and onboard new technicians thoroughly.
Target partners via channel sales for geographic expansion without overhead.
Monitor profitability by client to eliminate resource-draining accounts.
Outsource to trusted third parties if in-house skills gaps arise.
Automate aggressively before adding headcount.

Secure Strategic Partnerships

Partnering with complementary providers allows expanding your offerings without overextending internal resources.

Team with software firms to bundle licenses into managed plans. Offer unified billing/support.
Ally with telecom companies to provide comprehensive voice/data services.
Join IT consortiums to collectively bid on large accounts.
Integrate with IaaS providers so clients can procure cloud infrastructure through your MSP.

Choose partners strategically based on shared values, excellent reputations and mutual benefit. Formalize relationships through revenue sharing, co-marketing and referral agreements.

Joint partnerships also help cross-sell clients, this is one of the best answers for how to grow your managed IT services business. A private cloud vendor can upsell managed hosting services for increased security and support. Position your company as part of a client’s complete technology solution.

But avoid partnerships that detract from your core competencies. Only entrust customer-facing elements like service delivery to heavily vetted partners committed to excellence.

Extended Sales Cycles Require Patience

Transitioning clients to managed services involves lengthy sales cycles spanning many months. This requires foresight and persistent nurturing.

Provide extensive education addressing misconceptions like loss of control. Conduct on-site demos to build comfort with your team and capabilities.

Offer multi-year contracts with brief opt-out periods to reduce risk.

During negotiations, focus on total value delivered versus just cost comparisons. With patience and transparency, clients gain confidence embracing managed services’ benefits and your team’s expertise.

Time to Grow

The managed IT services market offers major opportunities, but requires forethought and precision to flourish.

Defining your specialty, systematizing delivery, and staying ahead of client needs will position you for steady, profitable growth year after year. With the right foundation, managed services can become the cornerstone of a thriving IT business.

Trust is earned slowly but rewarded with lasting relationships. Managed services sales require diligence, not haste.