On a 9-1-1 call with a relatively new member who begged to speak with me direct about how to save his company from the brink of extinction, I discovered he had gotten himself into serious debt due to a long list of unfortunate events, made exponentially worse by bad decisions – one of which was to wait before attempting to fix this as he neared rock bottom.
Essentially, it came down to this: he was “working 80+ hours a week” without a break, doing all the technical work himself because he couldn’t afford another engineer, paying for everything on Visa and American Express because he wasn’t making any money and was about to run out of credit.
His question to me was this: “How do I get more clients in the door FAST?”
For all the time I spend trying to get MSPs off their perch to do marketing and prospecting, you might find it interesting that I told him to slow his roll and NOT do anything to get more clients in the door. At least, not as the first thing to do.
It’s obvious, isn’t it? How can you be working “80+ hours a week” and NOT be making any money? There’s no way that can be true. Either you’re lying about the 80 hours OR you’re essentially doing everything for free. Further, my question back to him was “IF you’re working that many hours a week and you don’t have anyone to help you, how in the heck are you going to support MORE clients?”
The solution to his dilemma required several fixes: 1) start charging for things he wasn’t getting paid to do, billing clients appropriately, 2) DRAMATICALLY raise his prices on EVERY client, 3) demand the key core clients get on a managed services agreement that is APPROPRIATELY priced, and 4) get focused on doing items 1 through 3 and STOP frittering away hours doing menial work, social media and just about everything else that was distracting him from activities that would get him PAID.
Very often, MSPs get stuck in the mode of thinking ONLY in terms of “more leads, more clients, more revenue” when it comes to growing their business. But often, this is only one piece of the puzzle and may not be the area with the biggest opportunity for growth and wealth development.
To be clear, you should ALWAYS have a feeder system for getting new clients. Always. However, if you only do that and don’t go to work simultaneously DEVELOPING your current clients and developing your business, extracting the maximum amount of profitability as you can, you’re going to have a loooong hard climb to any level of success.
Business and client development is NOT just about making more money off the backs of your clients. Real client development incorporates expansion of services (value delivered) and maturation of your relationship with them. It’s a strategic process of making them a better client for you in a manner that also SERVES them. In doing so, you maximize your revenue and profitability now, as well as creating future wealth and enterprise value.
Here are some other reasons why “simple” growth might be a bad idea:
• Disintegration of service quality
• Erosion of profits (growth eats cash for breakfast, lunch, dinner and snacks in between)
• Multiplication of risk, complexity and problems
• A higher cost of acquisition (made worse if you DON’T have a client development strategy)
• Requires a looser criterion of who you accept as a client
But like the guy I was coaching, most MSPs don’t “see” what’s obvious and the easy money they could be making from their current clients; this is due to the many blind spots they have, often put there and cemented by negative beliefs they hold to be true. A scotoma, which is a chronic blind spot in otherwise normal vision, happens to business owners who are so close to what they’re doing that they can’t “see” what’s obvious to everyone else.
All business owners have these blind spots, but the smart ones realize it and constantly search for new ideas, new breakthroughs, new strategies and seek input from others who can “see” what they can’t. They venture out to events, get input from a variety of sources and force themselves to step back and question everything. Should we still be selling THIS service in THIS way? At THIS price point? To THIS market? This is critical to business development and stability. I’ll leave you with one more thought…
Twenty-nine years after World War II ended, a Japanese soldier was found in the jungles of Morotai still in uniform, still at his post, gun in hand, making his rounds, with no idea that the war was over. It’s easy to be trapped on your island, inside your dense jungle, unaware of big, significant changes going on around you. If you’re a member of ours, you have the benefit of getting exposed to a diverse group of speakers and experts at our events, which means you are far better off than most, but even with exposure to ideas, you have to be OPEN to receiving them(and show up!).
Right now, in this economy, there is a requirement for all MSPs to take a more strategic and sophisticated approach to growth. If you have any ambition to build your business in revenue, MRR, profits and clients, I’d urge you to join me at one of the remaining MSP Marketing Roadshow events. Breakthrough ideas WILL happen, your eyes opened to profit pathways you haven’t seen before. Get some.
