Q&A | December 16, 2013

How To Start Bundling Managed Services

Bernadette Wilson

By Bernadette Wilson

VAR consultant advisor

For VARs beginning to offer managed services, the question of how to add on or bundle services often presents new challenges. Channel executives from Continuum, AVG, and N-able by Solar Winds offer suggestions for where to begin.

“Some MSPs (managed services providers) start by offering something very small to their clients,” says Mark Zahar, vice president of channel at Continuum. “This approach does a couple of things: it starts the business owner expecting a monthly charge from the MSP (removing the barrier of break-fix) and also allows the MSP to start building a relationship with the client.  This strategy can be very effective because the risk is very small.” An example is offering a simple virus protection/patching plan at a charge of a few dollars per device.

He adds a second strategy that new MSPs use is bundling a backup solution combined with remote monitoring and management (RMM). “Most business owners realize the importance of backup, but the real value is in restoring that backup,” Zahar comments.  “What’s nice about this strategy is that you can have different service offerings based upon the frequency of backup and how quickly you guarantee the restoration. Some businesses may need to be back up in minutes while others may not.”

Zahar says to remember that when you are offering services, you are speaking to a business owner and not the technical team. “Talk to them about real business problems, potential issues, and outline a plan — with choices — based upon their tolerance of risk. I guarantee you will come across as the advisor and start building the trust that’s necessary.”

David Weeks, channel sales specialist, major accounts, and team lead for N-able by SolarWinds, suggests a different approach. “Generally the easiest and most efficient way for VARs to start to win new business is through an à la carte model that will allow them to directly align services and support with the business objectives of customers and prospects,” Weeks says. The main components of this model generally include items such as AV, data backup and management, patch management services, and spam services — all areas every business owner understands are required at a minimum to keep their IT environment running smoothly. “This approach gives VARs the opportunity to better understand client needs, use information obtained throughout any à la carte support efforts, and better define and build the offering and support agreement based on the needs of the customer,” explains Weeks.

Mike Foreman, general manager, SMB, for AVG Technologies, adds, “Smaller resellers are facing a future where the traditional break-fix services model is being replaced by cloud services provision. One of the first/easiest services for them to bundle is frontline security. Protection from viruses and spam is a natural starting point for businesses that do not have their own IT department but who want professional help managing their IT systems.”

Foreman says as resellers move to the managed services model, however, selecting the right vendor to partner with is critical. “They should choose a vendor that understands smaller resellers and can guide them through the often daunting transition to a recurring-revenues model,” he points out.

More information on bundling services, read the BSM article “Avoid The À La Carte IT Menu Trap.”