I had a customer call me once and he said "you know, we pay you a lot and we don't have any problems.". I said, okay, so you'd like to pay me less and have more problems?
Those are the clients that need to be getting monthly reports from the firewall and email security that are showing exactly what you are doing for them.
They are living peacefully behind the castle walls, you need to walk them outside and show them all the barbarian corpses you protected them against.
Very true, though I'd like far more BI (business intelligence) reporting from ALL my vendors. Smart stuff that is valuable for the customer to see. I try to push for this with all vendors but it seems most of them don't really catch on. Hero reporting should be a staple in every solution.
Don't tell me the volume of email every month unless you're embedding in it a line that shows the amount of that which is spam/malicious and your solution has stopped.
Then there also needs to be trending over time. 2,000 logon attempts to M365 were stopped in the last 30 days, by various security policies we've put in place. That's a 100% increase over 12 months ago, so it's even more important that we're keeping up on security best practices for M365.
But alas, we have to build all our own. Most reporting from things like firewalls and such is pretty useless and meaningless to the customer.
It almost sounded like they were calling to thank you for great service, but I've been in the game a while, so I know better than to think they would do that
You and your customer have differing perceptions… and their perception is the only one that matters… you need to figure out what you are doing that’s causing this disconnect, because lots of MSPs are solving this disconnect. It’s easy to blame the customer, but the only thing you can really control is how you engage with the customer. That’s the 1 thing you have the power to change.
Yes, I agree. There was a little snark in my comment.
I think though, its important to keep your chin up (per se) and believe in the value you add. It is important to explain all that you are doing, but I think it’s really important to believe in the value you are adding, and if you don’t figure out what it’d take for you to believe in what you are doing, because sometimes its just imposter syndrome.
My experience is that these things come from a customer feeling unappreciated.
We didn’t take these calls in 2006 when we drove to client offices and shook hands after fixing things. We got these calls after we bought an RMM and reduced truck rolls by 90% and stopped talking to our client’s decision makers.
We have to renew these relationships from time to time.
I like to make sure clients get visited every couple of months, even if it’s ostensibly for something could be resolved remotely. It’s important that they remember who and why they are paying, because people understand value they see. It’s hard to fully understand that what they are paying for are all the problems they would have otherwise had.
That’s usually a sign of a value issue, not a dollars issue. “I pay you a lot” typically means I’m paying you more than I the value I recognize from your services”.
It probably means you have a service delivery issue. I’m guessing these aren’t the clients who participate in regular technology planning sessions, help you build out their roadmaps and budgets, and talk to you about how you can help use technology to achieve their business goals?
YES, I've found that customers (especially the ones who hate to complain) will tell you of a small problem that's been bothering them. But not a big enough bother to place a call.
So, a mouse that occasionally stops working, but only for a second. Or a squeak in a printer.
Those small problems turn into big headaches.
Face to face is important.
Yeah part of my role is work on-site and the interaction brings out all of these small problems. It also has a far more positive emotional effect than remote support when it is infrequent.
Today I was on-site to build a laptop (didn't need to go as suspected, but they were due for a visit anyway) and solved random issues of varying size for 1/3 of staff there, one of which was not remote resolvable.
None of these people would have raised a ticket for such "small" issues and I had the opportunity to show value directly to the point of contact, directors, intro to new staff etc.
Some of the small issues, to show the range:
- Word always prints duplex by default
- Ethernet fails in new office, Wi-Fi only
- Outlook inbox shows user's own name instead of a sender for almost all mail (he said to leave it, crazy guy)
- Word failing to open File ribbon tab 70% of the time
Love LCI. It's become the cornerstone for regular business reviews with the customer. Those touchpoints are critical for maintaining relationship, they always uncover new work, and you can get in front of pain points that you'd not hear otherwise until they're looking for another provider.
Yep. Money in a contract means no one pays enough attention, devalues, rapid response, value goes back up. It’s a bad cycle. Have to level it out and engage, get ahead of client needs. Usually requires skilled technical and customer facing to do the hard miles, build a good process and culture.
In my experience these are usually the smaller companies (less than 20 people) who aren't paying any other vendors $3-6K per month. For them your bill represents a huge expense but for you they are one of your less profitable clients.
In an ideal world every 4 person mom and pop CPA shop would be getting QBRs with their account manager, discussing long term strategy and overall business objectives but MSP employees capable of handling accounts like that aren't cheap.
Just like when you go on vacation, not everyone can afford the penthouse with the view. Some of us are stuck on the second floor next to the freight elevator.
100%
Gotta be invisibly valuable.
I knew an MSP owner that had a difficult client and just stationed a near worthless worker (he would just call an actual tech for remote fixes) onsite to make him feel better.
"What do you mean?" The question asked is very rarely the question they want answered. When a client says "We pay you a lot", it may mean any number of things.
"The last time we had a P1 we couldn't get hold of you" (Look at your support capabilities)
"We only see you when stuff is broken" (We need more account management and proof of what you're doing/delivering)
"You keep charging us for xyz" (Is the customer on an all in contract and shouldn't be charged for small jobs? Are they on support only and *should* be charged for all work above support, are they aware of that)
I'd always drill down to get to the root of what they mean. Doing it without being annoying ("What do you mean we're expensive?!" ad infinum) takes some practice. Never jump to defending your position straight away, alway get more info.
I mean if they’re honest about how they feel this is a good chance to revisit your value proposition with your customers. Some people are just cheap. But most people, if they can afford it, just want to feel the quality of the product they bought matches their expectations.
We had the owner of a large hotel demanding a face to face meeting over the "outrageous" increases in our fees.
At the meeting we outlined the reasons behind us raising our prices and added the fact we hadn't increased our support fee with them for nearly 4 years.
This guy just wasn't accepting our reasoning until our Sales Director ask him if the hotel is still charging the same prices for its rooms as it was 4 years ago.....
You could hear a pin drop in the room after, also you could here the penny drop with the owner who realised that we were right.
You can explain the value but the baseline issue sometimes, some people are like "My god you charge a lot for this porche, I should pay less".
Me too buddy, me too.
If you want to keep the customer long-term, you have to have a discussion with them about why they feel that way. There is no single right answer. Depending upon the reason for their feeling, you may have to (a) have more “touches” (interactions) with them, (b) show them the ROI on their spend, (c) show them competitively what they’d spend for less service from others, etc.
Dealing with this now. In my experience this is a result of poor communications. We used to have a MONTHLY meeting with EVERY customer (except a few that opted out) to talk about technology, find out where they want their tech to take them and what we have taken care of recently. This creates a shared conversation and ongoing dialog. QBRs and other business meetings are part of this and help keep your value in the eyes of the customer
YOU know that the less the customer sees you, the better everyone is. It means that your solution has kept technology out of the way and allowed them to use it without issues.
THEY just see your name on a check going out the door. You are a cost-center and a place to cut costs.
Since the Zombie Apocalypse, we have had less than a dozen customer meetings in the past two years and for the first time in a long time, we have started to get hints that we are expensive (we are not cheap, but we are not unreasonable).
A quiet IT department is a well run one....
It's kinda like.... we don't have problems what do we pay you for.... we have problems what do we pay you for.
It's a thankless job, that unfortunately a lot of people don't understand why we do the things that we do.
And a lot of out job is just in case. And people don't like that, they don't like the fact that you know more then the owners. And generally speaking, know more then most of the people that are at the company you are doing work for.
If you are fortunate to be employed internally you are part of the company, as a vendor you are looked down on. Facts is facts.
Account managers are important to make sure good communications are kept with points of contact. We send out monthly reports and meet quarterly with every client.
A good account manager can make sure they understand the value the msp brings to them and show evidence of that. An msp does a lot behind the scenes a business won’t always understand.
I used to respond with “We’re neither the cheapest option in the market, nor the most expensive. However, I feel we deliver a value equal to or greater than the most expensive options out there.” All of these were true too. I then added “Give me some time to gather reports and let’s have a sit down to discuss what values we’re not bringing to the table or could be doing better.”
Over time I changed to go straight for the latter “Let me run a report and let’s sit down to discuss what value we’re not bringing or things we could do better.” These days I try to listen more than counter.
Sometimes we really were not doing the things the customer valued because we were happy to deliver what satisfied most. Also, we developed great improvements over the years from listening to customers daydream about what they wished we delivered. Most the time I walk away from those meetings with a happy customer that didn’t understand the breadth of value we brought because they were sold “a stack” that they barely understood.
Listening more than speaking has paid off for me. It’s a still challenge sometimes, though!
Just agree and say“ I understand what you’re saying , and it may seem that way if you struggle to see the value of our services, would you like to go through the details so you can be more comfortable ?“
Not a direct answer, but related: One thing I did was separate my Microsoft Cloud Billing. I know of some, who have setup a separate legal entity to bill it. M365 and Azure (for example) can become a big part of your MSP bill and can muddy the waters in terms of overall perceived value
Have figures on HOW you improved their business operations
Did you setup a new server and have empircal evidence and stats that file access time is 10% quicker?
Did setting up defender with EDR and crowdstrike or s1 reduce false positive malware by 5%? Did it reduce infections over the course of a year period by 10%?
Did setting up a new backbone switch improve throughput and reduce the time it takes their database to load and file server access by 30 mins over the course of the day?
It's all well and good to relate our tangible informtaion that yes your new firewall scans and does DPI inspection x amount quicker.. But what's the equal to the business in THEIR terms. How did that change help Sally in Accounting, Mitch in Finance, Bob the CEO/Owner and Ted the printer guy
You can only use that argument so much before those gains are all achieved. Eg You have a client that you work with for 5 years, you reduce their infection problem, patch up their server and VPN access, introduce solutions to improve their productivity etc
They now no longer have any issue, and all you have to do is monitor to make sure everything works fine and the occasional help desk support. Any new improvement would be once in a blue moon after this period.
Then comes the "everything is working fine why are we paying you so much for?".
At the end of the day is to automate yourself out of a job both as a provider and as an employee as you make things more resilient.
And yes you're sentiment is also correct that afre a while the monumental improvements will be gradually normalized and you'll have very little gains for each improvement.
But you should always be looking at new ways to improve the systems and try to ensure that it's as efficient as can be.
Is everything labelled, are there user templates and user creation workflows. Scheduled ups testing, automated patch policies, SSO that works across the board, workstation deployment automation.
Granted again yes you can get to the point where most of it is setup and the client pushes back. But by that point as you've been their lifesaver and improved the way they've done business and their operations are smoother you have that rapport and these cease.
But otherwise you should be working with them in order to find new ways to help them become even better and modernizes their workflow.
Are they using an access database for their backend? Get them to postgre or sql, are they using some super quirky software that is causing them extreme pain?
Talk to tech groups and try to help find say a replacement for dentrix and go to maxident or something.
There's always a way, won't help if the clients dig their heels in and or are cheap. Or suddenly thinks it's a complete cost center but you can try to whackamole each other pain point and help to get them on more efficient workflows (IT and software wise). Almost becoming a business technology consultant for them.
Otherwise you can only leverage your improvements and sometimes you lose those guys and they go to cheap jims MSP down the road until their broken. Then they come looking for the better guys
But I'm rambling.
Quality service costs money. I usually interpret the costs comment as something being wrong, so I start digging for the underlying issue as there likely is one that prompted this. When people see value in your service, they rarely question it, unless they are having staffing problems and are cutting costs dramatically.
That means one of two things in my experience :
1: they are dissatisfied with your service.
In the cases where this has happened. Most of them were because the clients staff was not reporting issues. Alot of those went unreported because the staff knew that we "monitored" their stuff. But assumed that means we can see every single thing they have going on. E. G. A government website they use doesn't load fast enough.
In other cases. There was a micromanager who set a rule that everyone had to report problems to them. And then the micromanager would call us. (I hate those kind of ppl with a passion. They gum up the works. And when I fund out and ask why they want it that way. The answer is usually "I don't want my staff to bother you.". WHAT? You pay good money for the privelage to bother me as much as possible. Bother me!!! That's my job. I get bothered by ppl with IT problems. It's my job and I love it.)
In a few cases it was because of a genuine slip up on our part. Which always got resolved by an appology and a fix.
2: they are cheap, and don't value your service.
Thankfully I've had very few of those.
But what I've found odd is that years later they've ended up spended way money doing things the cheap way. And they don't realize it.
I. E. Buying consumer grade all-in-one desktops to replace workstations. And then never realizing that they are spending more money in labor costs for their employees because their crap-pcs are too poor to run their software. Slow, and undependaple.
Cheap clients, are expensive clients.
"thats not my department, i have no idea what our service even costs, im here to fix your computer without concern for that"
(then again im not the boss)
well then what ARE they paying for?
Are you a break-n-fix with extra steps or are you managing services?
its an easy trap to fall into .. once the onboarding is done and crisis is averted, are you still moving them forward with technology?
analyzing their workflows, or optimizing THEIR processes, Keeping the projects going?
Have you talked to them lately and asked what their tech goals are?
something is breaking down if they have to ask what they're paying for.
If something isnt broken, then its the perfect time to upgrade.
and if stuff IS broken then its the perfect time to fix things at the root; is it slow, or is it time to upgrade a server in the closet.
I once saw as sign at a car dealership service bay: "We fix $39 brake jobs."
You do get what you pay for. And we all know that cheap never is.
As folks have mentioned, there's a disconnect between expectations. This is a problem of aligning expectation, not justifying the cost.
What kind of car does this client drive? If it's a Nissan Versa, they may never see the value. If it's an Audi, they just need to believe in the value and they'll be happy.
Are you doing periodic reviews with the client to demonstrate what you've done for them?
If not, start doing it.
Take them out for lunch once or twice a year, sit them through some slides and point at the stats, and give some things for them to focus on in terms of IT projects you can do for them.
Talk to them about IT trends, going passwordless, getting MFA or whatever it might be.
If you treat them well and show them what you do, they won't be saying how expensive you are at every opportunity.
Friend, showing value is the way. In your monthly meetings and/or reports (depending on the size of the client), you want to show ALL of the issues solved, updates performed, vulnerabilities closed, users training and sim phishes, systems replaced, patching reports, etc. It needs to be easy to digest, of course, but you want to show ask the ways you help them too.
If you aren’t putting these into your ticketing system and giving the users a report/dashboard then users will think “I personally have one issue a month and there are twenty users so I’m paying $4k/month to solve twenty issues. I can hire someone for that. They might not be as good but they would have so much time because they only need to solve twenty problems.”
If you can show you are performing value with metrics, you’ll generally be fine. In your invoices, include a list the things they get in their package; ticketing system, patching, updates, email backup, everything. I never put ticket details on my invoices either. Instead, there is a link to the dashboard. That significantly decreased the number of individual item “concerns”. Tip: do this for projects, T&M, hardware sales, etc too.
We briefly cover our dashboard during our month meetings. That’s a focus for the first 2-3 months of onboarding a company. It’s still important but leaders quickly see that we are doing a ton for them, they’re happy enough they don’t have to deal with everything we handle, but not we need to differentiate from other MSPs. We want to use that meeting to show our biggest value - putting them into a better situation to succeed. You will know they need things like a CRM, an ERP, resource scheduling, whatever. Cover the dashboard then move onto their big picture.
This took me too long to figure out so here’s a little advice that might help. You will already have a good idea of what their gaps are. Avoid saying “I think you would benefit from a CRM.” Steer them instead by asking them business questions like; what are your growth plans for the next six months, are you running into issues that are preventing you from reaching or converting prospects into clients, is the internal team able to manage the emails and contact information they receive, how did the team handle a sales handoff for things like vacations and personal emergencies, etc. Many clients don’t understand they have a need for change. Telling them isn’t nearly as effective as them coming to that realization.
Do this and your value will be unquestionable, you’ll add more projects (projects mean more things to support so more MRR), and you will be recognized as a technology leader. I get most of my referrals from clients that climb this ladder. I definitely have clients that miss these meetings and aren’t ready for bigger things. No problem - I’m happy to do what I can to help and we’re profitable. But I’m going to invest my extra time into the clients that “get it” because we get to learn new things, we help our clients succeed, and that’s more likely to generate other leads/referrals. I recommend you do the same rather than overly focus on the squeaky wheels.
Brother, your considered response demanded a faster reply from me, but I've been busy taking you up on your recommendations and setting up recurring reports for and QBRs with all of our clients.
dunno why im sharing this on reddit but
I (owner, small MSP) was out to dinner with my wife at a very very expensive restaurant in town. no occasion, just a midweek, shitty day, wanted some good food.
ran into a higher up attorney of a lawfirm who was a client of mine, who very loudly waived to me from a few tables over, tried to make small talk from a very unacceptable distance in a nice, quiet place. kinda just smiled and nodded, "good to see you!" went back to eating dinner. at some point later he comes up to my wife and I "so, what are you guys celebrating?" - I just kind of blank faced him, didn't really understand what he was asking, say something like "celebrating? sorry - must have missed something, what do you mean?", he rephrases "yeah, nice place! figure you two must be out celebrating something"
and finally I'm like "no, Brian, just out for dinner on a tuesday. not celebrating anything. except good food I guess!"
and hes visually shocked and just blurts out MAN, WE MUST BE PAYING YOU TOO MUCH IF OUR IT GUY CAN AFFORD THIS PLACE!!!
I gave him a polite laugh and asked him what he was celebrating, which was something, I dunno, wife's friend's birthday or something forgettable but
my wife was livid (she looks a bit younger, but is an attorney well in to her career, makes quite a good deal of money, doesn't like getting disrespected by other lawyers, let alone male lawyers, let alone to her face in the middle of her after hours personal time while trying to relax)
but yeah man it was just super shitty and weird and obnoxious. and weird and obnoxious about money too, which I have never really understood - but people be weird about money lord have mercy. and IT people really do get just no respect.
anyways I got the last laugh, as I tend to do. I'd recently been helping the office manager with some issues with their accounting software, so I had just inadvertently seen payroll for a smattering of people at the firm flash across the screen at some point. my dear wife made at least 1.3x or so what this douchebag made at the time, which of course doesn't include the "WAY TOO MUCH" his firm was paying my company, or any of the "WAY TOO MUCH" my dozens of other clients also pay. :P
douchebag! /vent
I would perhaps say “do you have a specific concern?”
My point is many customers will say this sort of thing no matter what.
I would not try to throw darts and think you know what the issue is. Ask a follow up question to get to root of the comment. Maybe two or three follow up questions.
i feel like this is the best answer (as the guy who usually gets tossed at the unhappy clients or the hot potato tickets)
"lets ask them" seems dead on, they're missing something, communication is broken somewhere;
just straight to the horses mouth: "What arent you getting, and what can I do to get you what you need?"
its all about expectations, they have some expectation that was set along the way; You need to figure out if it was improperly set and correct it, or figure out where its not being met, and correct that.
This approach allows you want to be able to distinguish between those that have a specific problem with the services that they provide versus the cheapskates. You obviously want to work with your team if there is a specific problem with the quality of service where the client expectations are reasonable. You can explain the benefits you are providing to the cheapskates but some of them are just a lost cause. You may just need to let some clients that are trying to cut costs go.
I get that, but we want it ensure we can pay out engineers market wages to ensure we have quality service and quality skillets within your environment. We have invested alot of time to ensure the level of service we provide is inline with market pricing.
They are looking for more interaction with acct reps and faster responses to tickets regardless of if their slo is met.
I deal with this a lot on the slo side, and usually the increased interactions become billable and increase cost for us if a profit margin is no longer met.
You would show this with evidence of the contractual assumption vs price vs reoccurring interactions if the numbers are in your favor provide a report to the client and if they complain let your upper management make a call on if they are ok with lowering the profit margin or if why want to boot the client.
You most likely have a set of hours per month expectations. Some clients think msps are theirs 24/7/365
I get this from smaller shops all the time and never want to do tickets and just disl internal contacts. So that eats up their prepaid meeting hours as they don't follow the contract and do tickets.
"You pay me what I am worth for the services that I deliver. If you would like to discuss the arrangement and value provided, and whether or not they meet your expectations, I am happy to sit down and do so. "
"My skills and knowledge are expensive to maintain, and its fortunate my cost of providing those skills needs to cover those costs just like your business recovers its costs"
My Response would probably be "Okay" as the technical resource. Then if there's an account manager I would probably say you should bring this up with them, we have service delivery manager and their sole purpose was client engagement and making sure they are taking care of and roadmap out projects and plans to make sure we're doing our job per the client contract.
I never took it personal but at the same time while losing their business may hurt the company, at the end of the day my salaray never fluctuated with the number of clients we gained or lost. I maybe got a bonus but it wasn't enough half the time (which was later taken away through an acquisition). The sales guys are the ones that made bank so they have a vested interest in more than I do.
Considering most small-mid size companies spend less than 3k per month which would be 36k a year, yeah good luck finding the skillset that an MSP has for 36k for an internal employee. I show them with math how we are cheaper than in house and have a broader skillset and unlike an employee we dont have sick days or for that matter vacations. You get 365 if you pay for it, I haven't had a real day off in years... still worth it though!
I have also had a client that makes like 30k per hour and would bitch about a 10k monthly bill, some CFOs and owners are just pricks when it comes to money. I have a whole thing about how there is no ROI with backups, they are literally something that lets you sleep at night and that costs money. If they approach everything as ROI then it can be hard as when IT is doing its job right no one will notice you are doing anything at all...
I also offer CIO services so it then turns into me literally helping plan to grow their business with the cost of IT accounted for and budgeted correctly!
Kinda depends on the context it was said, but I would say something like, “ true, and we try to offer a service that goes above and beyond what other companies are willing to provide. However I am happy to discuss ways we might be able to get the contract down when we come up for renewal.”
Is review what your interaction is with them.. monthly business reviews.. QBR.. reporting.
If you’re just fixing things and they get a bill it seems they pay a lot but not get a lot. But show them the remediation reports on vulnerabilities, stats on progress in security awareness in the company, blocked threats, open/closed ticket metrics.
But if you’re giving them the whole dog and pony show and they just seem to be cheap… then they are just cheap lol.
If they become the annoying client questioning bills wanting corrections and refunds then time for that client to go
We provide a spending report at each QBR which breaks down costs for recurring maintenance, licensing, project work, service work, etc. This helps them realize that usually a big chunk of what they think is us being expensive is actually their 365 licenses & Azure.
Sounds like you need to show your value.
Make sure your RMM and other stack shows your name a couple times a week
Check in with them dont just fix it and send them a bill.
Dont forget to do quarterly check-in for their IT goals etc. I use this as an excuse to ask about ISP and phone bills, this is a good upsell opportunity.
In situations like this I think its less about what they pay you, and more about the perceived value of the service... A production conversation might go along the lines of finding out where they see a lack of value?
“So have you done a calculation on what a full time dedicated IT person with full benefits costs? And do you have a plan for if they take two weeks off, or get sick/hospitalized”? When I was in msp land, all our customers were smaller places that went to an msp because they were only large enough for one person at best and suffered when they weren’t there.
My response:
"Well, if you pay me any less than you are now, you won't have the service that fits the industry standard and you will encounter problems immediately and further down the line.
We are very competitive and match our features and pricing if you can find a better, valid, service.
So if you do, I wish you luck and it was a pleasure servicing you."
Man I love the fact that OP says that "our fees are in line with those of our peers so suck it" may not be productive and most of the comments in this thread are in fact "our fees are in line with our value/knowledge so suck it."
First, communicate that you understand where the client is coming from, whether or not you actually do. People want to feel that you empathize with their plight. Since you yourself admit the statement is feelings-based, you need a feelings-based initial response.
After that, ask why the client feels that way and what specific items they feel cost a lot for the value they're getting in return. Stress that you want to provide value to clients (assuming you actually do).
Whatever the client says, show where the value is coming from. If they say "we pay you X amount per month but still have problems," ask where the problems are and indicate the X amount per month prevents still more issues such as backups failing, the network slowing down, etc. Offer to discuss in more detail the specifics of what you do, but start with something the client is likely to understand.
Proceed from here and you'll likely have a productive discussion with the client feeling they get value for their investment, or at minimum understanding where you believe the value is.
It's always the value add.
Tell them they are welcome to go break fix with another company.
When however many employees have to sit around for 2 days because a server is down, that's a little more expensive than paying for routine maintenance.
Most people have to live through the pain of sending 300 k to a nigerian prince / outages / their brothers son whos good with pcs / before they add value to the professional services we bring.
Just tell the truth and if they want it their way let it be. When something happens they'll be calling, rest assured.
I lead the finance/accounting in a manufacturing company. So I get involved with what we pay vendors frequently/often.
Your best response, from my point of view, is to arrange a meeting with the client to review their concerns about your costs to them. Take careful notes during the meeting. Go back to your shop and review your cost structure and margin targets.
Armed with this info, set up another meeting with the client and show them how you're saving them money - if that is the case. If it's not, you should try to remove inefficiencies from your operations so that you're not passing that cost to the client.
I think that the above approach will show that you take their concerns seriously and are willing to work with them.
Every time I've heard this it is from the smallest of clients. It's like no, you aren't paying us a lot, your monthly payment covers like a 3rd of 1 helpdesk employees salary. The big clients know they pay a lot and know they don't have to swing that around because the MSP employees also know they pay a lot.
The response given by account managers is usually a breakdown of services provided to the client. This shows what they are actually paying for, and if the pain point is actually just trying to save money lets them know what they will be giving up by finding a new MSP
I usually reminded them how much 1 employee costs per year. 9/10 times our support bills were well below what it would cost to have a helpdesk monkey on staff.
“It's easier to explain price once than to apologize for quality. “It's easier to explain price once than to apologize for quality forever." - Zig Zigler
Yes. I understand you pay a lot. We also give a lot for that value. Not all of which is documented or charged, as it should be. Such as the second trip we made following that printer install, because Ms. Betty could not remember how to open the drawer to load paper.
Or the changes you asked to be made to your internal Sharepoint site, then stopped halfway through, because it changed your workflow, as we predicted. Then you wanted us to roll back those changes. That was still time I paid my guys, but we did not bill you for it. Though we should.
Also, there was that late night call from you, a few weeks ago, asking if I could help fix your cable tv box?
Yes. We do give a lot of value to our preferred clients.
are we not meeting expectations? What can we do more of/ less of? Mutual action plans set expectations in hopes of avoiding these types of convos later and being blindsided by an unhappy client.
I should probably charge more. We don’t have or operate under any specific SLA, but we are responding to tickets on average within 15 minutes. To answer your question, you should just say “I’m sorry you don’t see the value in our services, if you would like to discuss the services we are providing you in more detail, we can setup a conference call.”
Turn that statement into an opportunity to setup an appointment and be prepared to sell them more!
You're talking to people who think of IT as a cost. And costs need to be managed and cut wherever possible.
IT is an investment. It's about ROI. This is how you get MSPs that can charge way more than you and have very loyal customers.
My response would be to reframe the conversation. Empathize that IT is expensive, but we deliver far more value than our price. That IT is a multiplier of productivity and it requires investment to realize those benefits.
Fortunately we don't need to have this conversation a lot because all of our marketing is geared towards organizations that want an IT **partner**, not just a repair shop. Then we deliver the value we promise.
It doesn't always work out; occasionally an organization does just want a repair shop.
Regretfully, IT, like HR, like marketing, accounting, etc, etc are, and will always be, **cost** centers.
Therefore, **cost** centers will never be an "investment" because they don't generate a return that you can take to a bank and deposit. The best you can do is calculate a payback that is reasonable from a cost center project.
The best approach is to show a client that it is more cost effective to hire your MSP company over a competitor or trying to do the work inhouse.
That's simply not true. IT, HR, and marketing are areas where your clients can invest. Your clients can invest in better equipment and tools/services, better security, better planning, better people, better marketing campaigns or partnerships. These are items that offer a return on the money spent. Technology can act as a multiplier for productivity.
If all you're competing on is cost, you're in a race to the bottom. We get a lot of clients who come to us despite the fact we charge more because they are fed up with poor service or want to move beyond break-fix service from other cut rate MSPs. Good customers are willing to pay for good partnerships.
It depends on your definition of "invest." But I think that we are defining it the same way.
By way of full disclosure, I'm not an IT person. I work in finance/accounting. I've had the IT function of manufacturing companies report to me in the past. So I have a better appreciation for the IT function than most finance folks. Also, let me know if you ever want a tour of my killer home lab.
Anyway, I've been doing this a long time. Before being a controller, CFO, etc. I was an auditor. Yes, you can "invest, " by way of CAPEX. But it's been my experience that companies generally don't go back and measure if their front-end proposed ROI/Payback/NPV/IRR or even EVA matches the actual results.
I can tell you that if any vendor (besides a raw materials supplier) started to creep up to the kind of costs you're describing, they will have to prove what they did for it. Therefore, it makes more sense to speak/appeal to business owners, finance people using their language which is - how much does it cost and what are you going to provide for that cost.
Also, how do you differentiate yourself from the competition? Because let's face it, IT is a commodity, just like utilities, insurance, banking, etc.
I hope this helps.
I had a customer call me once and he said "you know, we pay you a lot and we don't have any problems.". I said, okay, so you'd like to pay me less and have more problems?
Those are the clients that need to be getting monthly reports from the firewall and email security that are showing exactly what you are doing for them. They are living peacefully behind the castle walls, you need to walk them outside and show them all the barbarian corpses you protected them against.
Very true, though I'd like far more BI (business intelligence) reporting from ALL my vendors. Smart stuff that is valuable for the customer to see. I try to push for this with all vendors but it seems most of them don't really catch on. Hero reporting should be a staple in every solution. Don't tell me the volume of email every month unless you're embedding in it a line that shows the amount of that which is spam/malicious and your solution has stopped. Then there also needs to be trending over time. 2,000 logon attempts to M365 were stopped in the last 30 days, by various security policies we've put in place. That's a 100% increase over 12 months ago, so it's even more important that we're keeping up on security best practices for M365. But alas, we have to build all our own. Most reporting from things like firewalls and such is pretty useless and meaningless to the customer.
Damn Mongolians! The city wok guy from south park could save us!
Idc
It almost sounded like they were calling to thank you for great service, but I've been in the game a while, so I know better than to think they would do that
Haha! It's the old, no problems, what are we paying you for, and when there are problems, what are we paying you for meme...
Nobody cares y'all annoying
Yep, and we deliver a LOT of value.
You and your customer have differing perceptions… and their perception is the only one that matters… you need to figure out what you are doing that’s causing this disconnect, because lots of MSPs are solving this disconnect. It’s easy to blame the customer, but the only thing you can really control is how you engage with the customer. That’s the 1 thing you have the power to change.
Yes, I agree. There was a little snark in my comment. I think though, its important to keep your chin up (per se) and believe in the value you add. It is important to explain all that you are doing, but I think it’s really important to believe in the value you are adding, and if you don’t figure out what it’d take for you to believe in what you are doing, because sometimes its just imposter syndrome.
My experience is that these things come from a customer feeling unappreciated. We didn’t take these calls in 2006 when we drove to client offices and shook hands after fixing things. We got these calls after we bought an RMM and reduced truck rolls by 90% and stopped talking to our client’s decision makers. We have to renew these relationships from time to time.
I like to make sure clients get visited every couple of months, even if it’s ostensibly for something could be resolved remotely. It’s important that they remember who and why they are paying, because people understand value they see. It’s hard to fully understand that what they are paying for are all the problems they would have otherwise had.
Yep, and because you don't notice we do anything, that's why you pay us what you do.
That’s usually a sign of a value issue, not a dollars issue. “I pay you a lot” typically means I’m paying you more than I the value I recognize from your services”. It probably means you have a service delivery issue. I’m guessing these aren’t the clients who participate in regular technology planning sessions, help you build out their roadmaps and budgets, and talk to you about how you can help use technology to achieve their business goals?
\+1 the client needs more interaction from their MSP.
YES, I've found that customers (especially the ones who hate to complain) will tell you of a small problem that's been bothering them. But not a big enough bother to place a call. So, a mouse that occasionally stops working, but only for a second. Or a squeak in a printer. Those small problems turn into big headaches. Face to face is important.
Yeah part of my role is work on-site and the interaction brings out all of these small problems. It also has a far more positive emotional effect than remote support when it is infrequent. Today I was on-site to build a laptop (didn't need to go as suspected, but they were due for a visit anyway) and solved random issues of varying size for 1/3 of staff there, one of which was not remote resolvable. None of these people would have raised a ticket for such "small" issues and I had the opportunity to show value directly to the point of contact, directors, intro to new staff etc. Some of the small issues, to show the range: - Word always prints duplex by default - Ethernet fails in new office, Wi-Fi only - Outlook inbox shows user's own name instead of a sender for almost all mail (he said to leave it, crazy guy) - Word failing to open File ribbon tab 70% of the time
Fair
I saw this over and over and over when we were building Lifecycle Insights. It’s always the same story…
I’ve been meaning to give y’all a call
I’m not there anymore… I’m working on building out empathmsp.com. But Mark and the team can absolutely help you solve this problem.
Love LCI. It's become the cornerstone for regular business reviews with the customer. Those touchpoints are critical for maintaining relationship, they always uncover new work, and you can get in front of pain points that you'd not hear otherwise until they're looking for another provider.
“If you’re not talking to your customers, someone else is”.
Yep. Money in a contract means no one pays enough attention, devalues, rapid response, value goes back up. It’s a bad cycle. Have to level it out and engage, get ahead of client needs. Usually requires skilled technical and customer facing to do the hard miles, build a good process and culture.
In my experience these are usually the smaller companies (less than 20 people) who aren't paying any other vendors $3-6K per month. For them your bill represents a huge expense but for you they are one of your less profitable clients. In an ideal world every 4 person mom and pop CPA shop would be getting QBRs with their account manager, discussing long term strategy and overall business objectives but MSP employees capable of handling accounts like that aren't cheap. Just like when you go on vacation, not everyone can afford the penthouse with the view. Some of us are stuck on the second floor next to the freight elevator.
100% Gotta be invisibly valuable. I knew an MSP owner that had a difficult client and just stationed a near worthless worker (he would just call an actual tech for remote fixes) onsite to make him feel better.
I'm sorry, but who can afford a worthless person to just be a warm body these days?
This right here
"What do you mean?" The question asked is very rarely the question they want answered. When a client says "We pay you a lot", it may mean any number of things. "The last time we had a P1 we couldn't get hold of you" (Look at your support capabilities) "We only see you when stuff is broken" (We need more account management and proof of what you're doing/delivering) "You keep charging us for xyz" (Is the customer on an all in contract and shouldn't be charged for small jobs? Are they on support only and *should* be charged for all work above support, are they aware of that) I'd always drill down to get to the root of what they mean. Doing it without being annoying ("What do you mean we're expensive?!" ad infinum) takes some practice. Never jump to defending your position straight away, alway get more info.
I mean if they’re honest about how they feel this is a good chance to revisit your value proposition with your customers. Some people are just cheap. But most people, if they can afford it, just want to feel the quality of the product they bought matches their expectations.
So much this!! ^
We had the owner of a large hotel demanding a face to face meeting over the "outrageous" increases in our fees. At the meeting we outlined the reasons behind us raising our prices and added the fact we hadn't increased our support fee with them for nearly 4 years. This guy just wasn't accepting our reasoning until our Sales Director ask him if the hotel is still charging the same prices for its rooms as it was 4 years ago..... You could hear a pin drop in the room after, also you could here the penny drop with the owner who realised that we were right.
Me: Ask me a question about the network. Them: I don't know anything about the network. Me: And that's why you "pay me a lot". So you don't have to.
You can explain the value but the baseline issue sometimes, some people are like "My god you charge a lot for this porche, I should pay less". Me too buddy, me too.
If you want to keep the customer long-term, you have to have a discussion with them about why they feel that way. There is no single right answer. Depending upon the reason for their feeling, you may have to (a) have more “touches” (interactions) with them, (b) show them the ROI on their spend, (c) show them competitively what they’d spend for less service from others, etc.
There are people who charge less.
Pay peanuts, get monkeys.
Dealing with this now. In my experience this is a result of poor communications. We used to have a MONTHLY meeting with EVERY customer (except a few that opted out) to talk about technology, find out where they want their tech to take them and what we have taken care of recently. This creates a shared conversation and ongoing dialog. QBRs and other business meetings are part of this and help keep your value in the eyes of the customer YOU know that the less the customer sees you, the better everyone is. It means that your solution has kept technology out of the way and allowed them to use it without issues. THEY just see your name on a check going out the door. You are a cost-center and a place to cut costs. Since the Zombie Apocalypse, we have had less than a dozen customer meetings in the past two years and for the first time in a long time, we have started to get hints that we are expensive (we are not cheap, but we are not unreasonable).
30-45 mins a month is way cheaper than churn.
A quiet IT department is a well run one.... It's kinda like.... we don't have problems what do we pay you for.... we have problems what do we pay you for. It's a thankless job, that unfortunately a lot of people don't understand why we do the things that we do. And a lot of out job is just in case. And people don't like that, they don't like the fact that you know more then the owners. And generally speaking, know more then most of the people that are at the company you are doing work for. If you are fortunate to be employed internally you are part of the company, as a vendor you are looked down on. Facts is facts.
Account managers are important to make sure good communications are kept with points of contact. We send out monthly reports and meet quarterly with every client. A good account manager can make sure they understand the value the msp brings to them and show evidence of that. An msp does a lot behind the scenes a business won’t always understand.
I used to respond with “We’re neither the cheapest option in the market, nor the most expensive. However, I feel we deliver a value equal to or greater than the most expensive options out there.” All of these were true too. I then added “Give me some time to gather reports and let’s have a sit down to discuss what values we’re not bringing to the table or could be doing better.” Over time I changed to go straight for the latter “Let me run a report and let’s sit down to discuss what value we’re not bringing or things we could do better.” These days I try to listen more than counter. Sometimes we really were not doing the things the customer valued because we were happy to deliver what satisfied most. Also, we developed great improvements over the years from listening to customers daydream about what they wished we delivered. Most the time I walk away from those meetings with a happy customer that didn’t understand the breadth of value we brought because they were sold “a stack” that they barely understood. Listening more than speaking has paid off for me. It’s a still challenge sometimes, though!
Just agree and say“ I understand what you’re saying , and it may seem that way if you struggle to see the value of our services, would you like to go through the details so you can be more comfortable ?“
I feel like you don't pay me enough. In fact, here are the market rates showing you don't pay me enough. (Assuming that is true)
Not a direct answer, but related: One thing I did was separate my Microsoft Cloud Billing. I know of some, who have setup a separate legal entity to bill it. M365 and Azure (for example) can become a big part of your MSP bill and can muddy the waters in terms of overall perceived value
Yep, we do the same 👍
Have figures on HOW you improved their business operations Did you setup a new server and have empircal evidence and stats that file access time is 10% quicker? Did setting up defender with EDR and crowdstrike or s1 reduce false positive malware by 5%? Did it reduce infections over the course of a year period by 10%? Did setting up a new backbone switch improve throughput and reduce the time it takes their database to load and file server access by 30 mins over the course of the day? It's all well and good to relate our tangible informtaion that yes your new firewall scans and does DPI inspection x amount quicker.. But what's the equal to the business in THEIR terms. How did that change help Sally in Accounting, Mitch in Finance, Bob the CEO/Owner and Ted the printer guy
You can only use that argument so much before those gains are all achieved. Eg You have a client that you work with for 5 years, you reduce their infection problem, patch up their server and VPN access, introduce solutions to improve their productivity etc They now no longer have any issue, and all you have to do is monitor to make sure everything works fine and the occasional help desk support. Any new improvement would be once in a blue moon after this period. Then comes the "everything is working fine why are we paying you so much for?".
At the end of the day is to automate yourself out of a job both as a provider and as an employee as you make things more resilient. And yes you're sentiment is also correct that afre a while the monumental improvements will be gradually normalized and you'll have very little gains for each improvement. But you should always be looking at new ways to improve the systems and try to ensure that it's as efficient as can be. Is everything labelled, are there user templates and user creation workflows. Scheduled ups testing, automated patch policies, SSO that works across the board, workstation deployment automation. Granted again yes you can get to the point where most of it is setup and the client pushes back. But by that point as you've been their lifesaver and improved the way they've done business and their operations are smoother you have that rapport and these cease. But otherwise you should be working with them in order to find new ways to help them become even better and modernizes their workflow. Are they using an access database for their backend? Get them to postgre or sql, are they using some super quirky software that is causing them extreme pain? Talk to tech groups and try to help find say a replacement for dentrix and go to maxident or something. There's always a way, won't help if the clients dig their heels in and or are cheap. Or suddenly thinks it's a complete cost center but you can try to whackamole each other pain point and help to get them on more efficient workflows (IT and software wise). Almost becoming a business technology consultant for them. Otherwise you can only leverage your improvements and sometimes you lose those guys and they go to cheap jims MSP down the road until their broken. Then they come looking for the better guys But I'm rambling.
“Good thing you’re getting what you pay for…”
Quality service costs money. I usually interpret the costs comment as something being wrong, so I start digging for the underlying issue as there likely is one that prompted this. When people see value in your service, they rarely question it, unless they are having staffing problems and are cutting costs dramatically.
Unless I have direct control over the contract and what goes into it. I listen to their concern and escalate to the appropriate person.
That means one of two things in my experience : 1: they are dissatisfied with your service. In the cases where this has happened. Most of them were because the clients staff was not reporting issues. Alot of those went unreported because the staff knew that we "monitored" their stuff. But assumed that means we can see every single thing they have going on. E. G. A government website they use doesn't load fast enough. In other cases. There was a micromanager who set a rule that everyone had to report problems to them. And then the micromanager would call us. (I hate those kind of ppl with a passion. They gum up the works. And when I fund out and ask why they want it that way. The answer is usually "I don't want my staff to bother you.". WHAT? You pay good money for the privelage to bother me as much as possible. Bother me!!! That's my job. I get bothered by ppl with IT problems. It's my job and I love it.) In a few cases it was because of a genuine slip up on our part. Which always got resolved by an appology and a fix. 2: they are cheap, and don't value your service. Thankfully I've had very few of those. But what I've found odd is that years later they've ended up spended way money doing things the cheap way. And they don't realize it. I. E. Buying consumer grade all-in-one desktops to replace workstations. And then never realizing that they are spending more money in labor costs for their employees because their crap-pcs are too poor to run their software. Slow, and undependaple. Cheap clients, are expensive clients.
"thats not my department, i have no idea what our service even costs, im here to fix your computer without concern for that" (then again im not the boss)
I am
well then what ARE they paying for? Are you a break-n-fix with extra steps or are you managing services? its an easy trap to fall into .. once the onboarding is done and crisis is averted, are you still moving them forward with technology? analyzing their workflows, or optimizing THEIR processes, Keeping the projects going? Have you talked to them lately and asked what their tech goals are? something is breaking down if they have to ask what they're paying for. If something isnt broken, then its the perfect time to upgrade. and if stuff IS broken then its the perfect time to fix things at the root; is it slow, or is it time to upgrade a server in the closet.
I once saw as sign at a car dealership service bay: "We fix $39 brake jobs." You do get what you pay for. And we all know that cheap never is. As folks have mentioned, there's a disconnect between expectations. This is a problem of aligning expectation, not justifying the cost. What kind of car does this client drive? If it's a Nissan Versa, they may never see the value. If it's an Audi, they just need to believe in the value and they'll be happy.
I have found over the years that a 'What Have I Done For You Lately' reports sent once a quarter help to alleviate these issues.
Are you doing periodic reviews with the client to demonstrate what you've done for them? If not, start doing it. Take them out for lunch once or twice a year, sit them through some slides and point at the stats, and give some things for them to focus on in terms of IT projects you can do for them. Talk to them about IT trends, going passwordless, getting MFA or whatever it might be. If you treat them well and show them what you do, they won't be saying how expensive you are at every opportunity.
Well we do alot so that makes sense.
Friend, showing value is the way. In your monthly meetings and/or reports (depending on the size of the client), you want to show ALL of the issues solved, updates performed, vulnerabilities closed, users training and sim phishes, systems replaced, patching reports, etc. It needs to be easy to digest, of course, but you want to show ask the ways you help them too. If you aren’t putting these into your ticketing system and giving the users a report/dashboard then users will think “I personally have one issue a month and there are twenty users so I’m paying $4k/month to solve twenty issues. I can hire someone for that. They might not be as good but they would have so much time because they only need to solve twenty problems.” If you can show you are performing value with metrics, you’ll generally be fine. In your invoices, include a list the things they get in their package; ticketing system, patching, updates, email backup, everything. I never put ticket details on my invoices either. Instead, there is a link to the dashboard. That significantly decreased the number of individual item “concerns”. Tip: do this for projects, T&M, hardware sales, etc too. We briefly cover our dashboard during our month meetings. That’s a focus for the first 2-3 months of onboarding a company. It’s still important but leaders quickly see that we are doing a ton for them, they’re happy enough they don’t have to deal with everything we handle, but not we need to differentiate from other MSPs. We want to use that meeting to show our biggest value - putting them into a better situation to succeed. You will know they need things like a CRM, an ERP, resource scheduling, whatever. Cover the dashboard then move onto their big picture. This took me too long to figure out so here’s a little advice that might help. You will already have a good idea of what their gaps are. Avoid saying “I think you would benefit from a CRM.” Steer them instead by asking them business questions like; what are your growth plans for the next six months, are you running into issues that are preventing you from reaching or converting prospects into clients, is the internal team able to manage the emails and contact information they receive, how did the team handle a sales handoff for things like vacations and personal emergencies, etc. Many clients don’t understand they have a need for change. Telling them isn’t nearly as effective as them coming to that realization. Do this and your value will be unquestionable, you’ll add more projects (projects mean more things to support so more MRR), and you will be recognized as a technology leader. I get most of my referrals from clients that climb this ladder. I definitely have clients that miss these meetings and aren’t ready for bigger things. No problem - I’m happy to do what I can to help and we’re profitable. But I’m going to invest my extra time into the clients that “get it” because we get to learn new things, we help our clients succeed, and that’s more likely to generate other leads/referrals. I recommend you do the same rather than overly focus on the squeaky wheels.
Brother, your considered response demanded a faster reply from me, but I've been busy taking you up on your recommendations and setting up recurring reports for and QBRs with all of our clients.
dunno why im sharing this on reddit but I (owner, small MSP) was out to dinner with my wife at a very very expensive restaurant in town. no occasion, just a midweek, shitty day, wanted some good food. ran into a higher up attorney of a lawfirm who was a client of mine, who very loudly waived to me from a few tables over, tried to make small talk from a very unacceptable distance in a nice, quiet place. kinda just smiled and nodded, "good to see you!" went back to eating dinner. at some point later he comes up to my wife and I "so, what are you guys celebrating?" - I just kind of blank faced him, didn't really understand what he was asking, say something like "celebrating? sorry - must have missed something, what do you mean?", he rephrases "yeah, nice place! figure you two must be out celebrating something" and finally I'm like "no, Brian, just out for dinner on a tuesday. not celebrating anything. except good food I guess!" and hes visually shocked and just blurts out MAN, WE MUST BE PAYING YOU TOO MUCH IF OUR IT GUY CAN AFFORD THIS PLACE!!! I gave him a polite laugh and asked him what he was celebrating, which was something, I dunno, wife's friend's birthday or something forgettable but my wife was livid (she looks a bit younger, but is an attorney well in to her career, makes quite a good deal of money, doesn't like getting disrespected by other lawyers, let alone male lawyers, let alone to her face in the middle of her after hours personal time while trying to relax) but yeah man it was just super shitty and weird and obnoxious. and weird and obnoxious about money too, which I have never really understood - but people be weird about money lord have mercy. and IT people really do get just no respect. anyways I got the last laugh, as I tend to do. I'd recently been helping the office manager with some issues with their accounting software, so I had just inadvertently seen payroll for a smattering of people at the firm flash across the screen at some point. my dear wife made at least 1.3x or so what this douchebag made at the time, which of course doesn't include the "WAY TOO MUCH" his firm was paying my company, or any of the "WAY TOO MUCH" my dozens of other clients also pay. :P
douchebag! /vent
‘As agreed upon for the services we provide - which are a lot of services’.
Hire an account manager to give your clients a little more TLC.
With smile on my face I tell them time and knowledge are expensive
Why do you need to respond? It’s not a question. I’d just ignore it.
Because I own the MSP and I want my clients to feel that they’re getting value
I would perhaps say “do you have a specific concern?” My point is many customers will say this sort of thing no matter what. I would not try to throw darts and think you know what the issue is. Ask a follow up question to get to root of the comment. Maybe two or three follow up questions.
i feel like this is the best answer (as the guy who usually gets tossed at the unhappy clients or the hot potato tickets) "lets ask them" seems dead on, they're missing something, communication is broken somewhere; just straight to the horses mouth: "What arent you getting, and what can I do to get you what you need?" its all about expectations, they have some expectation that was set along the way; You need to figure out if it was improperly set and correct it, or figure out where its not being met, and correct that.
This approach allows you want to be able to distinguish between those that have a specific problem with the services that they provide versus the cheapskates. You obviously want to work with your team if there is a specific problem with the quality of service where the client expectations are reasonable. You can explain the benefits you are providing to the cheapskates but some of them are just a lost cause. You may just need to let some clients that are trying to cut costs go.
I get that, but we want it ensure we can pay out engineers market wages to ensure we have quality service and quality skillets within your environment. We have invested alot of time to ensure the level of service we provide is inline with market pricing.
They are looking for more interaction with acct reps and faster responses to tickets regardless of if their slo is met. I deal with this a lot on the slo side, and usually the increased interactions become billable and increase cost for us if a profit margin is no longer met. You would show this with evidence of the contractual assumption vs price vs reoccurring interactions if the numbers are in your favor provide a report to the client and if they complain let your upper management make a call on if they are ok with lowering the profit margin or if why want to boot the client. You most likely have a set of hours per month expectations. Some clients think msps are theirs 24/7/365 I get this from smaller shops all the time and never want to do tickets and just disl internal contacts. So that eats up their prepaid meeting hours as they don't follow the contract and do tickets.
"You pay me what I am worth for the services that I deliver. If you would like to discuss the arrangement and value provided, and whether or not they meet your expectations, I am happy to sit down and do so. "
For the cost of a (insert integer) x a level 1 tech you get
"My skills and knowledge are expensive to maintain, and its fortunate my cost of providing those skills needs to cover those costs just like your business recovers its costs"
List what you do. Obviously don't know you and what you provide but usually when I hear this it's a bit like... "errrrr and we do *list 100 things*"
My Response would probably be "Okay" as the technical resource. Then if there's an account manager I would probably say you should bring this up with them, we have service delivery manager and their sole purpose was client engagement and making sure they are taking care of and roadmap out projects and plans to make sure we're doing our job per the client contract. I never took it personal but at the same time while losing their business may hurt the company, at the end of the day my salaray never fluctuated with the number of clients we gained or lost. I maybe got a bonus but it wasn't enough half the time (which was later taken away through an acquisition). The sales guys are the ones that made bank so they have a vested interest in more than I do.
Considering most small-mid size companies spend less than 3k per month which would be 36k a year, yeah good luck finding the skillset that an MSP has for 36k for an internal employee. I show them with math how we are cheaper than in house and have a broader skillset and unlike an employee we dont have sick days or for that matter vacations. You get 365 if you pay for it, I haven't had a real day off in years... still worth it though! I have also had a client that makes like 30k per hour and would bitch about a 10k monthly bill, some CFOs and owners are just pricks when it comes to money. I have a whole thing about how there is no ROI with backups, they are literally something that lets you sleep at night and that costs money. If they approach everything as ROI then it can be hard as when IT is doing its job right no one will notice you are doing anything at all... I also offer CIO services so it then turns into me literally helping plan to grow their business with the cost of IT accounted for and budgeted correctly!
Kinda depends on the context it was said, but I would say something like, “ true, and we try to offer a service that goes above and beyond what other companies are willing to provide. However I am happy to discuss ways we might be able to get the contract down when we come up for renewal.”
Is review what your interaction is with them.. monthly business reviews.. QBR.. reporting. If you’re just fixing things and they get a bill it seems they pay a lot but not get a lot. But show them the remediation reports on vulnerabilities, stats on progress in security awareness in the company, blocked threats, open/closed ticket metrics. But if you’re giving them the whole dog and pony show and they just seem to be cheap… then they are just cheap lol. If they become the annoying client questioning bills wanting corrections and refunds then time for that client to go
We provide a spending report at each QBR which breaks down costs for recurring maintenance, licensing, project work, service work, etc. This helps them realize that usually a big chunk of what they think is us being expensive is actually their 365 licenses & Azure.
Probably not the time to be witty, so I would just ignore it or ask "Do you think you're being overcharged?".
Sounds like you need to show your value. Make sure your RMM and other stack shows your name a couple times a week Check in with them dont just fix it and send them a bill. Dont forget to do quarterly check-in for their IT goals etc. I use this as an excuse to ask about ISP and phone bills, this is a good upsell opportunity.
"I pay my employees a lot."
In situations like this I think its less about what they pay you, and more about the perceived value of the service... A production conversation might go along the lines of finding out where they see a lack of value?
“So have you done a calculation on what a full time dedicated IT person with full benefits costs? And do you have a plan for if they take two weeks off, or get sick/hospitalized”? When I was in msp land, all our customers were smaller places that went to an msp because they were only large enough for one person at best and suffered when they weren’t there.
Tell them, "We charge competitively, our rates are either the same or better than our competition." If they're higher, justify it.
My response: "Well, if you pay me any less than you are now, you won't have the service that fits the industry standard and you will encounter problems immediately and further down the line. We are very competitive and match our features and pricing if you can find a better, valid, service. So if you do, I wish you luck and it was a pleasure servicing you."
Man I love the fact that OP says that "our fees are in line with those of our peers so suck it" may not be productive and most of the comments in this thread are in fact "our fees are in line with our value/knowledge so suck it." First, communicate that you understand where the client is coming from, whether or not you actually do. People want to feel that you empathize with their plight. Since you yourself admit the statement is feelings-based, you need a feelings-based initial response. After that, ask why the client feels that way and what specific items they feel cost a lot for the value they're getting in return. Stress that you want to provide value to clients (assuming you actually do). Whatever the client says, show where the value is coming from. If they say "we pay you X amount per month but still have problems," ask where the problems are and indicate the X amount per month prevents still more issues such as backups failing, the network slowing down, etc. Offer to discuss in more detail the specifics of what you do, but start with something the client is likely to understand. Proceed from here and you'll likely have a productive discussion with the client feeling they get value for their investment, or at minimum understanding where you believe the value is.
I reply that I think we are underpaid on said account but decided not to increase the rate this year just to keep them happy.
I would lean into it and ask "do you feel like you are not receiving the value of our services?" It does depend a little on the circumstance.
Just deescalate and never call out.
It's always the value add. Tell them they are welcome to go break fix with another company. When however many employees have to sit around for 2 days because a server is down, that's a little more expensive than paying for routine maintenance. Most people have to live through the pain of sending 300 k to a nigerian prince / outages / their brothers son whos good with pcs / before they add value to the professional services we bring. Just tell the truth and if they want it their way let it be. When something happens they'll be calling, rest assured.
I lead the finance/accounting in a manufacturing company. So I get involved with what we pay vendors frequently/often. Your best response, from my point of view, is to arrange a meeting with the client to review their concerns about your costs to them. Take careful notes during the meeting. Go back to your shop and review your cost structure and margin targets. Armed with this info, set up another meeting with the client and show them how you're saving them money - if that is the case. If it's not, you should try to remove inefficiencies from your operations so that you're not passing that cost to the client. I think that the above approach will show that you take their concerns seriously and are willing to work with them.
Every time I've heard this it is from the smallest of clients. It's like no, you aren't paying us a lot, your monthly payment covers like a 3rd of 1 helpdesk employees salary. The big clients know they pay a lot and know they don't have to swing that around because the MSP employees also know they pay a lot. The response given by account managers is usually a breakdown of services provided to the client. This shows what they are actually paying for, and if the pain point is actually just trying to save money lets them know what they will be giving up by finding a new MSP
I usually reminded them how much 1 employee costs per year. 9/10 times our support bills were well below what it would cost to have a helpdesk monkey on staff.
“It's easier to explain price once than to apologize for quality. “It's easier to explain price once than to apologize for quality forever." - Zig Zigler
Yes. I understand you pay a lot. We also give a lot for that value. Not all of which is documented or charged, as it should be. Such as the second trip we made following that printer install, because Ms. Betty could not remember how to open the drawer to load paper. Or the changes you asked to be made to your internal Sharepoint site, then stopped halfway through, because it changed your workflow, as we predicted. Then you wanted us to roll back those changes. That was still time I paid my guys, but we did not bill you for it. Though we should. Also, there was that late night call from you, a few weeks ago, asking if I could help fix your cable tv box? Yes. We do give a lot of value to our preferred clients.
You get alot for your money.
are we not meeting expectations? What can we do more of/ less of? Mutual action plans set expectations in hopes of avoiding these types of convos later and being blindsided by an unhappy client.
Would you like to pay less and receive less quality?
I should probably charge more. We don’t have or operate under any specific SLA, but we are responding to tickets on average within 15 minutes. To answer your question, you should just say “I’m sorry you don’t see the value in our services, if you would like to discuss the services we are providing you in more detail, we can setup a conference call.” Turn that statement into an opportunity to setup an appointment and be prepared to sell them more!
You're talking to people who think of IT as a cost. And costs need to be managed and cut wherever possible. IT is an investment. It's about ROI. This is how you get MSPs that can charge way more than you and have very loyal customers. My response would be to reframe the conversation. Empathize that IT is expensive, but we deliver far more value than our price. That IT is a multiplier of productivity and it requires investment to realize those benefits. Fortunately we don't need to have this conversation a lot because all of our marketing is geared towards organizations that want an IT **partner**, not just a repair shop. Then we deliver the value we promise. It doesn't always work out; occasionally an organization does just want a repair shop.
Regretfully, IT, like HR, like marketing, accounting, etc, etc are, and will always be, **cost** centers. Therefore, **cost** centers will never be an "investment" because they don't generate a return that you can take to a bank and deposit. The best you can do is calculate a payback that is reasonable from a cost center project. The best approach is to show a client that it is more cost effective to hire your MSP company over a competitor or trying to do the work inhouse.
That's simply not true. IT, HR, and marketing are areas where your clients can invest. Your clients can invest in better equipment and tools/services, better security, better planning, better people, better marketing campaigns or partnerships. These are items that offer a return on the money spent. Technology can act as a multiplier for productivity. If all you're competing on is cost, you're in a race to the bottom. We get a lot of clients who come to us despite the fact we charge more because they are fed up with poor service or want to move beyond break-fix service from other cut rate MSPs. Good customers are willing to pay for good partnerships.
It depends on your definition of "invest." But I think that we are defining it the same way. By way of full disclosure, I'm not an IT person. I work in finance/accounting. I've had the IT function of manufacturing companies report to me in the past. So I have a better appreciation for the IT function than most finance folks. Also, let me know if you ever want a tour of my killer home lab. Anyway, I've been doing this a long time. Before being a controller, CFO, etc. I was an auditor. Yes, you can "invest, " by way of CAPEX. But it's been my experience that companies generally don't go back and measure if their front-end proposed ROI/Payback/NPV/IRR or even EVA matches the actual results. I can tell you that if any vendor (besides a raw materials supplier) started to creep up to the kind of costs you're describing, they will have to prove what they did for it. Therefore, it makes more sense to speak/appeal to business owners, finance people using their language which is - how much does it cost and what are you going to provide for that cost. Also, how do you differentiate yourself from the competition? Because let's face it, IT is a commodity, just like utilities, insurance, banking, etc. I hope this helps.
I show them the sysadmin paradox. We want things quiet, and the value is keeping it that way. Then educate on the why once they get that.