There are several things that will prevent your MSP/IT company from growing at a rate that you would love to see. I am going to spoil the answer for you, but it’s usually the business owner holding back the operation.
As we work with more and more MSP/IT clients, we see the same problems repeatedly.
What Prevents An MSP/IT Company From Growing:
This will often fall into one of the three categories below:
- The business owner doesn’t know how to grow and hold themselves back.
- A lack of upselling existing clients.
- The existing marketing Strategy is null at best.
Every time here at growth generators, when a business owner brings us into a business to help it grow, there is always an issue that falls into the above three categories. Believe it or not, the business owner doesn’t know how to grow. This is a broad brush of a topic, but most reasons fall into this category.
The reason being that some business owners don’t know how to grow but what they fail to realize is they must give up some control of the business to be successful. This is where the problems arise. They have an idea of what they are “supposed to do,” but they aren’t doing it for fear of many other areas.
Projects won’t get done. The marketing must be approved by them, they don’t have their standard operating procedures in place. This is just to name a few. At the end of the day, the business owner is his own demise. Would you like to learn how to fix this? Keep reading as I will reveal the answers.
How to fix a business owner who doesn’t know how to grow.
I know this may sound crazy, but as a business owner, you must give up control.
From business owner to business owner, it’s hard to do so. As someone who owns a business, it’s not easy to hand over control to someone else. It’s something I struggle with every day. Most business owners don’t understand they are the problem, and it’s a hard thing to admit. It’s also a hard truth to accept when someone else tells you that.
Knowing your business could be better if you moved out of the way and let the professionals you hire do the hard work and heavy lifting is what makes big businesses successful. This doesn’t mean hiring outside companies this is true even with employees.
When you give up control to the people you hired to do a job, it’s an unnerving feeling but by allowing yourself to put full trust in the individuals you pay is a must. 99.9% of the time, we fail to help a business grow is because we are waiting for one thing. It’s the business owner holding up work because they want to give the final approval on everything.
This must end for a variety of reasons, and not all of them are linked back to your marketing. By you being the only one who can approve everything in your business, it puts everything on hold. Along with that it because a problem that keeps stacking on itself.
Because you “didn’t get around to it” on a Monday means now your Tuesday is even busier. Then you have a family emergency, or you leave early to watch your kids at their sports game, and now Monday and Tuesday's work is pushed till Wednesday.
People and companies are incentivized to help your business grow. Its far and few between you find an employee who wants to see their company fail. They want to keep their job and help the company grow because as the company grows, it now allows for them to earn more money and new positions.
When you hire an outside company, their success is measured by your success. For example, a marketing company wants you to grow because the more you grow, the more money you’re going to spend on marketing.
This perpetual cycle isn’t healthy for you or your business.
Avoid This & Get Out Of Your Own Way
If you believe the team you have in place isn’t the team that’s going to get you where you need to be its time to start interviewing. This doesn’t just go for marketing but your internal team as well. Outsourced contractors should be the least of your worries. They want to keep you as a client, so they should be doing everything they can to go above and beyond for your company. However internal teams aren’t always like that.
If you have made some poor hiring decisions or aren’t comfortable giving up responsibility to the people you hire, it's time you start looking for alternatives. It could be an internal shift to a new role or hiring someone who can help you in the needed areas.
Either way, a change must be made because you can hire the most brilliant people, but you won’t see the success you’re hoping for. I always tell people, if they can they should look internally. If someone has been at your company for years, they want the company to grow. Provide them the opportunity and support to meet and exceed the companies needs and you might be pleasantly surprised at the results they yield.
How do I know this?
Not so long ago I was that guy at an IT company.
The key to that statement is support. If they need training, guidance or feedback from the team, make sure they can get it. It will be invaluable for them in their new role and as a person altogether. You may need to hire leaders or make someone a leader.
What Is A Leader?
A leader is someone who can make decisions. Both good and bad. Why?
People who can’t make up their mind for whatever reason are typically not going to be a leader. A leader must be capable of making an educated decision. Not all decisions are going to be what you, the business owner, consider right, but it’s the fact they made the decision. When action is taken, and you may consider it to be the wrong action, you can coach the person to the right decision.
This is crucial to success because it allows that leader to be a better leader and think more like you. This will help decisions be made and over time they will be more and more aligned with what you would do. Keep in mind if they have made a decision you don’t agree with, ask them why. They may know something you don’t, and they may have made a bad decision in your mind, but they had a different view that influenced their choice.
Business owner holds themselves back because they don’t ask for everyone’s favorite thing.
Building a business off referrals is not a form of sustainable growth but, it’s the easiest low hanging fruit there is. Referrals can be one of the biggest drivers in business. As an MSP/IT company you can work with everyone, and there are very few conflicts of interest. Your main goal is to make sure their company is operating at 100% all the time.
Unlike marketing where there could be an unfair advantage if one marketing company is working with many of the same clients in a small area. MSP’s don’t have this same ethical issue. They don’t provide an unfair advantage. They can help companies grow without a doubt however they aren’t helping drive more customers to the business.
The simple fact is business owners hang out with other business owners.
Because of this, asking for a referral is easy, and if you’re doing a great job in a certain vertical, it makes sense to ask for them. You’re already familiar with the industry software they are using and the standard operating procedures they typically follow. It’s a no brainer to ask. When is the best time to ask?
After the first month when onboarding is complete. Give them a month to see how good your services are, and then from there, make it a point to follow up with them regularly. On this call, it’s important to ask a few questions.
“What did they like about onboarding?”
“What did they not like about onboarding?”
“How has support been?”
If the response you get isn’t great wait till everything is fixed and call every month till they see an improvement. This is a crucial step because it allows you, the business owner to make the necessary changes and gives you an excuse to call. Once everything is great ask for that referral. This will benefit you as a business by showing where there are weak points in your business as well as showing the client you care about their business. It’s a win win for both parties, and that response you get will only help your company get better.
Most Technology Companies Lack Upsells [And It Shows]
We all know how hard it is to bring on a good new client. There are fancy terms like CAC or customer accusation cost and many others. Simply put, you must spend money to make money even when it comes to getting new clients. Chances are good you already have a business that is thriving with great clients. Imagine making them way more profitable. Even up to a percentage of 50% more profitable of a company that could be huge.
Let’s say you’re a mid-size company with about 30 clients. All those clients are paying you 3000 per month to provide the services your company offers. If you could get half (15) of those clients to pay you an additional 50%. What could that do for your company?
If you have 30 clients all paying on average 3000 per month, you are bringing in just over a million dollars per year. That’s awesome and deserves a congratulations! But what if you could become 50% more profitable?
Let’s do some quick math:
3000 per client by 30 clients paying 12 months a year is: 1,080,000.
Now if you keep half the same:
3000 per client by 15 clients paying 12 months a year is: 540,000
If you could make 50% of the 50% more profitable it would look like this:
4500 per client by 15 clients paying 12 months a year is 810,000.
Combine that with the clients that are your existing clients, and you walk away with 1,350,000.
Which could be an additional 270,000 per year.
Simply put, that’s roughly a 25% increase in the size of your business.
Are you ready for the best part?
You didn’t do anything different but upsell new services to your existing clients. In the IT world, there are always ways to upsell clients, whether its new backup services, monitoring software, or shifting more services away from other vendors such as printers. It’s an easy way to make more money for the business, and the best part is you didn’t have to do anything to acquire these customers.
They were already happy with the services you and your company provide, and it’s a company they know, like, and trust. This also allows you as the MSP business owner more flexibility to make sure nothing bad could happen to them. It also provides you with additional revenue that you need to grow. That’s putting it into marketing or hiring staff to allow more flexibility when bringing on new clients. Either way, more money in your business is always a good thing.
Your MSP/IT Company Doesn’t Have A Clear Marketing Strategy
As much as we wish a shotgun type approach would work, I am sorry to say it doesn’t. It almost never works, and more so, it’s a waste of money. By doing everything and trying to help everyone all at once, you can’t help anyone. You may have heard the term spearhead your marketing effort. In a marketer’s mind, that means one thing. It’s about bringing everything to a point.
When Growth-Generators first started, we offered similar services, but we wanted to work with everyone. The unfortunate part of that is when you work with everyone, you can’t help anyone.
There are millions of niches out there, and it would be impossible to cover them all. As a marketing company we couldn’t possibly create enough content for every niche and service them all. It’s too much to learn and help with.
Therefore, you need to spearhead your marketing efforts. Our goal is to help one industry and make them as successful as possible. The overwhelming majority of our content is geared towards the tech industry and more specifically IT/MSP’s, SaaS, DaaS, and HaaS.
We work with companies that are outside that niche from time to time because they may have been a referral, or they heard about how great we are. Those are great.
But when it comes to marketing our content from YouTube to blogging and everything in between is made with the thought of those industries combined. This allows us to focus everything we do on one buyer persona we know extremely well. It allows us to provide better content, better training, better freebies and more.
You can learn more tips on MSP marketing strategies in this post.
Everything we do is to help those industries thrive. We spend less time thinking about who we want to market to and more time thinking about how to get in front of those individuals. Just like this blog post. It’s geared towards business owners who want to grow their MSP.
I know it may sound silly or even aggravating, but at the end of the day, this blog post will help thousands of tech company owners become better. The first step is realizing there is a problem and identifying what problem it is. If it falls into one of the above groups, then you already know how to fix it. If you're struggling to figure out what’s wrong with your business or not sure what area you fall into, reach out to us.
Mention you're struggling with the area above and we would be happy to offer a one-hour free coaching call. In that hour, we can help identify what’s going wrong and give you the knowledge to fix it. We are confident in our abilities because we have already had the good fortune of helping over 25,000 people, and it keeps growing regularly.
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