Charlotte MSP Earns 500% Profit on Each Customer Migration
Resellers who think there’s no money to be made under Microsoft’s Cloud Solution Provider program (CSP) should talk to Eddie Clark. Not only did he boost his Monthly Recurring Revenue (MRR) to $2000 in just 60 days. Clark also chalks up a 500 percent profit on each customer migration to Office 365.
So, how does he do it? By working with a reliable partner.
Clark is the one-man show behind SolveiT.rocks, an IT Consulting firm based in Charlotte, North Carolina. He had worked with other providers, including Microsoft, but made the switch to SherWeb about 4 months ago.
Clark was a Microsoft Advisor for several years, but said he got fed up dealing with their technical support department.
"There’s always been delays and back and forth with Microsoft technical support. They route you around and then hopefully you get to the right person. Then you get your ticket created and then they put you into the queue and hopefully you get a call back within four hours. For those of us who were dealing with multiple clients, that makes juggling and time management extremely difficult."
MSPs Leery of the CSP
Clark, who serves about 22 clients in the healthcare, finance and manufacturing industries, said he was eager to try the CSP because he saw it as an opportunity to make more money. He said when the CSP was first introduced, a lot of Managed Service Providers (MSPs) were leery of the cloud because they thought it would affect their on-premises contracts.
"When they (Microsoft) came out with the CSP model (in 2014), I really liked the sound of it. You really don’t make that much money on the Advisor model. Microsoft’s mantra was ‘Okay, we’re opening up this whole new avenue for you to make income.’ And people go, ‘Oh, but I can’t make a living off that.’ Well you can, if you do it right. It just takes time to figure it out."
Finding a good CSP partner takes a bit of time, too. After working with a few other CSP providers, Clark switched to SherWeb. He said he got tired of dealing with licensing, billing and support problems.
"The mechanisms aren’t there to provide support and I found myself dealing with licensing problems a lot. I spent a good deal of time managing tickets. I would have to adjust billing and do credit because nothing was right. That’s what drove me to work for a new CSP provider."
3-Level Support System
When Clark started SolveiT.rocks about a year ago, he wanted a practical way to solve his clients’ technical issues. He developed a 3-tiered support system and backed it up with his company slogan, "If we don’t solve it, you don’t pay!" Clark is proud to admit that he’s never had to honor this agreement. He said this is because he doesn’t stretch himself too thin. He offers his clients 3 types of service agreements with different response and resolution times. To make sure he can meet client demands, Clark employs 3 technicians and 2 sales people on a contractual basis and also works with a third-party help desk provider.
"Where most providers get into trouble is they want to do a blanket agreement for all clients. We spend a lot of time on the front end, learning the client’s business. We learn their pain points and figure out which of our menu items fit into their contract. Each and every one is a tailored solution. But we use only products and services that we know are best in breed and that includes what SherWeb is doing for us."
Clark said he wanted to promote Office 365 with his previous CSP providers, but felt it would just be too difficult.
"I didn’t want the headaches, but I recognized the need to head in that direction. I thought sooner or later, I’ll find the right partner. I’ve obviously found that in SherWeb and I’ve been marketing the Office 365 platform extensively within my existing customer base and within my prospects."
Building a Solid MRR
Clark said he also does a lot of upselling and cross-selling which has helped him build up a solid MRR. When he first started with SherWeb, his revenue for Office 365 was only $25 a month. He was able to increase that to about $2000 a month and currently has another $2000 worth of proposals out in the field. He also has plans to start reselling SherWeb’s hosted infrastructure.
Clark said because SherWeb provides its partners with free migration services, racking up profits on customer migration has been pretty easy. By charging his clients only $25 per mailbox, Clark has managed to earn a 500% profit on each migration.
"That’s easy breezy and they don’t complain about that charge. I was using another product before and charged $75 per mailbox. That was a harder sell. This is so much easier. No one even bats an eye at $25 a mailbox."
Clark said he was a bit hesitant to deal with SherWeb at first because their prices are a bit higher than other CSP providers he’s worked with. However, spending the extra money means he has more time to devote to his business.
"I no longer have to spend all that time chasing down license changes or billing problems or support issues. SherWeb has taken all that off my plate. The net effect is, I may be paying a few cents more each month, but my time is now spent generating new business instead of fixing those back office problems. My hope is that you will stay the course and keep doing what you’re doing because it’s been a great relationship."
