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

Published: 2019-11-07

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.

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