What MSPs Not Born in the Cloud Need to Know to Sell Cloud

August 10th, 2023

If you’re a growing IT Managed Services Provider (MSP), you know the formula:  

  1. Advise clients on how to choose the right IT solutions.
  2. Implement the solutions.
  3. Provide the ongoing services that keep them operating as efficiently as they did day one. 

But you also know the model is changing with cloud [aka, Infrastructure as a Service (IaaS) or Platform as a Service (PaaS)], and maybe you feel a little out of your comfort zone.  

Successfully providing cloud solutions requires a different approach. Your financial model and support model are both shifting if you’re not installing and maintaining local hardware. But the change can be better for clients and MSPs if you can sidestep common pitfalls and leverage the right cloud options. 

Cloud Framework Is More Important Than Ever 

This is all so important because Gartner forecasts that the global public cloud IaaS market will grow 23.7% in 2023 to reach a total of $150.3 billion before hitting $195.4 billion in 2024. The firm also found that all public cloud services – including IaaS, SaaS, and Platform as a Service (PaaS) — will grow 19.9% this year to total $597.3 billion.  

The overwhelming demand for cloud services leaves MSPs little choice but to find a way to deliver to stay competitive and maintain their market share. Fortunately, there are ways to do this successfully and Virtual Systems is here to help. 

Challenges MSPS Encounter When They Sell Cloud 

One of the primary challenges that established MSPs often encounter when venturing into cloud services is aligning their business model. While some solutions may already be offered “as a Service” with a monthly recurring revenue (MRR) stream, transitioning a significant portion of clients to Infrastructure-as-a-Service can pose cash flow issues if the majority of revenue comes from project-based and break-fix work. 

The shift from large one-time payments for on-site infrastructure projects to smaller, recurring payments necessitates a period of adjusting and building MRR to cover monthly expenses.  

Consequently, cash on hand may be lower and less predictable during this transition. Additionally, time must be allocated for the team to adapt to the new business model, impacting areas such as accounting, finance, service tracking for technicians, and commission models for sales representatives. 

Educating Sales Representatives on Selling Cloud Services 

Speaking of sales, it is essential to provide additional education to your sales representatives on adopting a consultative approach to effectively sell cloud services. It’s important to note that Infrastructure-as-a-Service is not a one-size-fits-all solution. There is a multitude of cloud products available to clients, and MSPs often leverage partnerships with Microsoft Azure, AWS, Google, and other providers to offer compelling cloud infrastructure options. 

Assisting clients in selecting the appropriate solution stack and services is pivotal to their success. Selling cloud services presents tremendous upside for MSPs, and embracing related needs through consulting, cross-selling additional solutions, and enhancing security offerings can unlock substantial opportunities for continued MSP growth. 

By aligning your business model, educating your sales team, and guiding clients towards the right cloud services, you can establish a strong framework to effectively sell cloud services while driving growth and success for both your MSP and your clients. 

Feel free to contact us to learn more about our comprehensive range of cloud services and how we can assist you in building a successful cloud strategy. 

You Need Cloud Framework Expertise 

Selling cloud infrastructure differs significantly from selling hardware or even Software as a Service (SaaS) applications. When clients invest in cloud services, they expect your guidance in successfully transitioning their on-premises systems to the cloud.  

Such projects require meticulous planning and expertise to determine which applications can seamlessly migrate and which necessitate new architecture. Additionally, your role involves advising clients on selecting the appropriate cloud services to ensure compliance with industry and data protection regulations. 

Cloud security is a critical concern that demands attention. While users may assume that the cloud vendor provides comprehensive security, a robust cybersecurity approach often requires additional solutions deployed by the end-user. Assisting clients in identifying and addressing any security gaps that could leave them vulnerable is essential. 

Maintaining strong client relationships also entails understanding cloud costs and providing guidance on cost control. For instance, helping clients accurately forecast cloud usage can prevent them from incurring higher costs for on-demand capacity. It also involves assisting them in leveraging autoscaling capabilities. However, navigating the intricacies of hourly payment models from certain cloud providers can pose challenges. 

When MSPs decide to incorporate Infrastructure-as-a-Service into their offerings, having experienced resources becomes crucial to effectively sell cloud services and provide clients with the necessary guidance. However, the current demand for skilled IT talent may pose difficulties in finding the right individuals. 

Alternatively, partnering with a specialized cloud firm can be a viable strategy, essentially establishing them as your dedicated “cloud department.” This collaboration allows your business to benefit from cloud projects’ revenue while maintaining control and continuing to earn revenue from the additional services you provide. 

Can Your Business Afford to Move Forward Without Cloud? 

Your business’ foundations may be deep in on-premises IT, but its future is in the cloud. Start building your strategy for how to acquire the talent and provide the solutions your clients need. 

Virtual Systems is a cloud-first IT partner empowering MSPs across North America to deliver excellent cloud outcomes to their clients and help make a seamless transition to a cloud-first business model. 

By leveraging our expertise and comprehensive cloud services, Virtual Systems can empower your MSP business to navigate the intricacies of selling cloud services successfully. Contact us today to explore how we can support your cloud initiatives and help you deliver exceptional value to your clients. 

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