To operate profitably, today’s Independent Computer Consultant must function on a Managed Service Model, providing proactive monitoring and remote support for a flat-monthly fee. But when so many of today’s small businesses are still accustomed to the outdated model of hourly support, it can be a challenge to convince them that preventing downtime through daily monitoring is less expensive in the long run than only having the consultant in whenever a problem occurs.
How do you make your case to your prospective (or current) small business customer that moving to a flat-fee, proactive model makes sense? Convert downtime into dollars and your point becomes easy to see.
According to a recent survey from International Data Corporation (IDC), the average small business generates a revenue of approximately $3.6 million dollars annually. As we Independent Computer Consultants tend to serve clients on the smaller side, let’s round that number down to $2 million to be safe.
If the client has 10 employees, we can estimate that each employee generates $200,000 of revenue per year. With 260 working days in a year and 8 hours per day, that breaks down to approximately $96/hr. per employee. Maybe that doesn’t sound like a tremendous amount on the surface, but add up the total number of service calls that might be made over the course of the year, and then couple that with the cost of doing repairs at an hourly rate, and the expense can really add up.
But let’s take a look at the big picture and consider the type of firm-wide problems that can be prevented. What if a hard-drive in the server were to fail and the backup hasn’t run in weeks, or a virus spreads across the network, or a hacker hijacks the server and sets it up as a spam relay. Issues like these affect millions of small businesses every day and can bring the entire company to a halt. With the cost of downtime for the entire company for a day being approximately $7680, plus the cost of repair at an hourly rate being approximately the same (assuming an average rate of $100/hr.), the true cost of a day of downtime is almost $16,000.
That doesn’t take into account the possibility of lost sales, lost data and lost time required to recreate lost data, damages to customer relations, etc, which could multiply that cost even more and in some cases be financially devastating to the small business.
Considering that a Managed Service Plan for a small company costs on average $1200/mo. or $14,400 annually and that any one of the above mentioned potential problems could easily be prevented with your included system monitoring, it becomes very easy to see how your Managed Service can provide a much greater value to a small business than an hourly support computer consultant who’s simply standing by waiting for a problem to occur.
Now tack on the benefit of being able to provide instant customer response through your remote support utilities (rather than having the customer wait for hours for their computer consultant to arrive), the increased productivity that will be gained by keeping the systems current, and the overall peace of mind that’s gained by knowing the network is being monitored around the clock, and it can be very difficult for a responsible small business owner to not switch to your Managed Service Plan.
Making the case for why switching to a managed service is a financially wise decision is an excellent foundation for getting a client to convert, but to guarantee your ability to seal the deal, you’re going to need to use tried and true sales techniques to combat any other objections that your client may try to raise. These techniques, along with tons of proven sales and marketing materials can be found at the author’s website.