You’re Costing Yourself $78 on Every $1 You Make by Ignoring Managed AV Services

Managed AV services can help your revenue grow more quickly than you probably realize. Why is it taking you so long to consider starting it at your firm?

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You’re Costing Yourself $78 on Every $1 You Make by Ignoring Managed AV Services

I’ve got a deal for all those AV integrators who are still resisting the switch to or addition of a managed services model: I’ll stop writing about why it’s important when you can tell me why you’re throwing away $78 per year on every dollar you’re making.

I’m certainly not someone who’s well-versed in high finance by any means, but I do understand this, as explained by Ben Jackson and West McDonald of Tigerpaw Software during the 2019 Total Tech Summit in Fort Worth, Texas, this week:

If you sign one new customer per month to a $1 monthly service contract, that’s an additional $78 per year in your pocket every year on every dollar you make.

For those who don’t believe me, I’ll explain it more completely: you sign customer A to a $1 monthly service contract in January, then add customer B for another $1 monthly service deal in February. That’s $2 for February. Add a third customer in March and it’s $3 for that month, and so on.

Still not convinced? I’ll make it even simpler for you: 1+2+3+4+5+6+7+8+9+10+11+12=78.

Managed Services Boosts Your Bottom Line

Many of you might have been burned by the rule of 78 when attempting to pay off a loan, since the practice is often used to frontload the interest you pay to the bank and discourage you from paying off your debt early. But trust me: this is something you’ll want to consider as soon as possible.

I’m guessing, once you do get around to launching your managed services arm—one of these days—you’ll be charging a lot more than $1 per month for whatever service you’re providing on top of your AV integration expertise. Imagine the possibilities with all of that additional revenue.

Yeah, I know it’s not easy. The panelists who joined me to talk about their managed services offerings at Total Tech Summit all agreed on that point, from a fledgling operation to a well-established version. The conversation with your customer and with your sales staff isn’t easy, but it’s necessary.

Unless, of course, you don’t like making more money.

About the Author


Craig MacCormack is the former executive editor of Commercial Integrator (2011-2021). He's a veteran journalist with more than 25 years of experience covering local and national news and sports as well as architecture and engineering before joining Commercial Integrator.

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  • I agree and by incorporating a cloud service provider it’s quick and easy to get started offering managed services. Also, utilizing cloud services makes it simple to provide additional offerings, like critical temperature monitoring, access control, video surveillance, which adds more value for your customers and grows your monthly revenue stream.. Today it is all about the customers experience after the installation is complete. Customers expect to be viewing, controlling and managing through some form of managed service software. The cloud makes connecting to systems much simpler than most other methods and requires less involvement and resources for dealers.

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