MSPs Can’t Be All Things to All People, So Specialize

Offering too many services can drive potential clients away, so figure out what you’re best at and focus there.

There was a time when the key to building a successful business in the reseller community was to offer the broadest selection of services so your customers never had to go to anyone but you for technology services.

That was long, long ago.

Jack-of-All-Trades and Master of None

What does it cost a channel partner company to provide service on a particular platform or product? How much do you need to spend on training for your technical staff? How much will stocking parts cost? Hot spares?

While it will vary from device to device, the answer is “plenty.” It’s not a trivial decision to provide support for any given product. It’s an expense you’ll need to encumber. So the more products you decide to support, the more plentiful will be your spending, and that’s before you sell a lick of service to anyone.

For those who are thinking “well, I don’t do break/fix anymore,” I’m not talking about just hardware repair. Becoming expert in anything is even more expensive. You want to support email servers? Database servers? Network Attached Storage systems, Storage Area Networks, Kubernetes Clusters, virtual servers, cloud infrastructure? Each requires significant training and preparation for your people, or an expensive new hire for each.

In those early days when everybody did everything, nobody did any of those things well yet. It was all way too new. You could get away with “on-the-job” learning because everyone else had to as well. You could indeed be the jack-of-all-trades with a long, long list of services in your catalog.

Then the industry grew up.

Further reading: Managing the Shift from Push to Pull: How VARs Became MSPs

The Medical Model

Consider the general practitioner. Not easy to do because there are precious few of them around anymore. The vast majority of medical professionals choose a specialty and build their practice around it. They all refer patients back and forth to each other, which reduces the competition between them.

If you’ve been a “general practitioner” of IT, now is the time to decide to specialize.

Eliminating Competition

As it became more and more obvious that the cloud had clobbered the service and storage sales business, more and more former “resellers” made a not-so-digital transformation to become Managed Service Providers (MSP). In fact, over time almost all of them made that transition.

As a result, if you’ve become an MSP you have tons and tons of competition. Everybody who was a reseller is now an MSP, and many of them have no idea what they’re doing. That serves to give “MSP” a negative connotation with customers. Ultimately, you don’t want to remain an MSP. You want to rise above that.

Think of it this way: when you specialize you no longer compete against the hundreds of thousands of other MSPs in the market. You only compete with others who have chosen the same specialty as you. That should be a whole lot fewer competitors than all the reseller refugees who call themselves MSPs.

What Do I Specialize In?

This is a key question, and the good news is that the answer is already in your database!

If you invoice customers for services and describe those services consistently when you invoice, you have a database that tells you which services you’ve sold and supplied to each customer.

Analyze this data. Create a simple grid listing your customers down the side and your services across the top. Check off each service you’ve sold to each customer. The columns that have the most checkmarks indicate the services you furnish the most. The rows will tell you which of your customers buy more varied services from you. Both things are very, very good to know.

A few services will stand out with many checkmarks. It’s a good guess that you and your team are expert at providing that service. Make that your specialty.

What to Do Next

Don’t stop doing what you’re doing! This is very important. Just because you’ve decided to change your focus doesn’t mean you stop doing what you’ve been doing. Keep delivering those services and enjoying the income from them while you build your focused practice.

Talk to your customers about the new services you’re planning to provide. Make note of the services that come up most often in these conversations and identify those “low-hanging-fruit” opportunities you can offer into your markets most readily.

Carefully document every project you provide to every customer. Nothing conveys confidence more than case studies of customers you’ve successfully served. Do an interview with them. Write up a case study. Hire a writer if you need to. Nothing is more compelling or more credible than showing one customer what you did for another. Especially when you can suggest the kind of return on investment (ROI) that first customer enjoyed, suggesting “and you can enjoy similar savings!”

Howard M. Cohen
Howard M. Cohen is a 35+ year executive veteran of the Information Technology industry who writes for and about the IT channel. He’s a frequent speaker at IT industry events, including Microsoft Inspire, Citrix Synergy/Summit, ConnectWise IT Nation, ChannelPro Forums, Cloud Partners Summit, MicroCorp One-On-One, and CompTIA ChannelCon, and he frequently hosts and presents webinars for many vendors and publications.

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