Rising costs and the fear of hyperinflation will cause many businesses to fail next year, but there’s a very different future in store for IT managed service providers.
If you just look at the data, it paints the year 2023 to be a very grim and difficult year for business owners in MOST industries… When costs rise and the economy softens, it triggers people to think twice about where they are spending money and look for companies that are willing to be more competitively priced to gain their business.
This is GOOD news for marketing-savvy MSPs who are positioned to offer truly compliant and secure solutions.
Most are still pretending it isn’t going to happen and they are just flat-out unprepared. The idea of the “lifetime” customer for IT managed service providers is fading FAST. Over the next 12 to 24 months you will start to see it happening more and more.
At TMT (Technology Marketing Toolkit) where we have over 10,000 MSPs and IT services business owners as clients, we have learned that most are being forced to pay their techs 18% to 22% MORE to do the same jobs they have been doing for the past 1-2 years or else they’ll risk losing their techs to a competitor.
To make it worse, despite raises being agreed on and offered, they are STILL losing their best engineers at times due to the fact that competitors are capable of offering 30%, and sometimes even 50% more pay, plus benefits.
To that end, EVERY MSP should have raised their rates by a solid 20% to 25% over this last year. Correct MSP pricing is one key to survival.
Yet still, so many IT managed service providers have not raised prices at all, or simply haven’t raised them enough. While there are a number of variables that go into this, I can tell you that, on average, your per-seat price for managed services should be in the $150 to $160 range. If you are still well below that, then you are likely just bleeding away profits.
A member of TMT, Matt Kahle, owner of Real IT Solutions, recently took our advice and generated a $557,484 increase with his existing clients by simply raising his rates with a single, 20-minute webinar.
Click Here to read: Matt Kahle And Adam Peterson Reveal Their Secret For Driving Massive Growth
If IT managed service providers want to survive what is coming, they will at some point be forced to raise their prices.
If we DO hit a HARD recession, you don’t want to be going to your clients in the middle of a major economic downturn to ask for more money for the SAME services. NOT smart.
The truth is that raising your prices now, while everyone expects it AND is still doing relatively okay, is the best and right time top do it. Ultimately, the choice is yours.
Conclusion
Inflation is out of control, there is a labor shortage, competition is increasing, and well-funded “Super MSPs” are making their way into your market. Will you wait months to do what you know is necessary, or continue to bleed out your profits and then timidly and ineffectively raise prices to an insufficient level when its too late?
There is a way that IT managed service providers can do this strategically so that they have happy clients and the margins they want. Life can get easier for these business owners and they can go into 2023 strong, by becoming marketing-savvy and positioning themselves to offer truly compliant and secure solutions.
If you are an IT services business owner that wants help with how to quickly set up an autopilot marketing system that will consistently get you 1-2 HIGH PROFIT managed services clients each month… Then click the link below to register for a free webinar hosted by TMT built specifically for you.
