MSPs Discuss Economy At ConnectWise Partner Summit
At the ConnectWise Partner Summit in Orlando, Fla., managed service providers are buzzing about a range of topics. Amid growing US economic concerns, many managed service providers here are striving to focus on marketing, sales and emerging partnerships. However, there’s no doubt that the economy is starting to impact MSPs. Here’s why.
I am not pressing the panic button. The vast majority of ConnectWise customers and partners tell me they continue to enjoy rapid recurring revenue growth. Similarly, the first participants in our new MSPmentor 100 survey (you can participate here) are typically growing 30 percent or more annually.
Still, several MSPs tell me (in private) they are now struggling to maintain growth that they used to take for granted. One MSP from Georgia says his company will grow roughly 20 percent this year. That sounds impressive, but he had expected even greater growth — until several regional banks and small businesses canceled their contracts with him.
Amid the financial storm surrounding AIG, Fannie Mae, Freddie Mac, Lehman Brothers and Merrill Lynch, mainstream media organizations like CNBC finally admit that Wall Street’s financial woes have spilled into Main Street, USA.
Meanwhile, IT vendors are delivering mixed messages. Dell, Ingram Micro and Nortel Networks this week each disclosed that their financial performance would fall short of expectations because of the economic turbulance. Dell’s stock hit a seven-year low on the news.
But the news isn’t all bad. Cisco Systems and Hewlett-Packard, respectively, this week have expressed optimism about their ongoing performance.
And sources close to Ingram tell me the company’s Seismic managed services effort continues to grow and generate recurring revenue, despite the broader IT sales challenges at the distributor.
Even fast-growing MSPs say they are taking steps to solidify their businesses and cash flow. For instance, an MSP based in Florida says he now requires customers to automate their monthly managed services payments. Payments for ongoing managed services are due in automated, electronic format the first Monday of each month.