Can MSPs Profit From IT Spending Cuts?

Jeff Auerbach, CEO of EMR Group, sent me an email highlighting a key challenge that’s also an opportunity for managed service providers (MSPs). Auerbach noted an AP story, indicating that 43 percent of large U.S. and European businesses have cut their overall spending on IT products and services for 2008, according to Forrester Research Inc. Here’s the bad news and good news for managed service providers (MSPs).The AP story said IT spending will grow 2.8 percent this year. A similar Forrester survey in December 2007 forecast 4.6 percent growth this year. Noted AP:

“In the survey, taken in late May and early June of nearly 950 IT managers at companies in North America and Europe, nearly half of the U.S. respondents said they have already cut their IT spending budgets, compared with 38 percent of those in Canada and 28 percent of companies in Germany. And 70 percent of respondents said they expect to negotiate lower rates with IT service suppliers.”

Time for MSPs to panic? Some customers may be wary of your sales calls. But you do have compelling messages to share:

• Every voicemail you leave a customer should indicate that you can help them cut their IT spending while boosting network and application reliability.
• You are uniquely positioned to help businesses to outsource mundane tasks (patch management comes to mind) that waste internal time, money and resources.
• You are uniquely positioned to help businesses free up their own resources for innovation, while you bulletproof their networks.

I’m not suggesting that MSPs are immune to the economic slowdown. But your messaging — predictable spending coupled with reduced costs and increased system reliability — is compelling in any economic situation.