Finding and Fixing Unprofitable Agreements

The Key to Boosting and Sustaining MSP Profitability

First, a caveat: assessing MSP client relationships should be done holistically. An underpriced agreement with a strong client may not be a problem. Use MSPCFO software to determine whether mediocre client performance is the result of a poor agreement and how to nurture that agreement back to health.

Start by uncovering below-average agreements and determining why they are lagging. The second part of this process is nearly as important as the first. Your MSP gets paid a certain amount for the labor expended in delivering managed services. If there’s an imbalance between what you get paid and how much work you perform, it bears examination.

Knowing where the problem lies is half the battle.

Larry Explains How to Make Underperforming Fixed Fee Agreements Profitable

Identify and remediate every Fixed Fee Agreement quickly and intelligently by acting on the cause NOT the symptom.

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Mispricing Is Not Always the Culprit

Raising prices is not the only arrow in your quiver. Reducing the work required would have just as big an impact on your effective hourly rate. Many times, MSPCFO has shown that the pricing for a troublesome client to be accurate on a per-machine or per-person basis. The client, however, may present an inordinate number of desktop software issues.

Instead of initiating action that likely would have resulted in the client leaving rather than paying a higher monthly fee, you can train the client to minimize these issues and/or solve them on their own. That’s how you turn a bad client into a good one.