Testing the Waters as a Managed Service Provider : Backup Reseller Program Review

December 16, 2011

The year is just about to wrap up.  Is your reseller business where you want it to be?

If you didn’t make the leap this year to providing managed services for your customers, let’s start laying the groundwork to get you there in 2012.  First off, a quick list of benefits to convince you.

  • Recurring revenue stream from services you may be outsourcing to vendors
  • Increased interaction with clients
  • Improved customer satisfaction

Aren’t those enough?  These are the top three benefits I’ve seen since starting to provide managed services to my clients.  I’ll address each one talking about the first managed service I provided to my customers; online backup service.

Recurring Revenue Stream

In the past I recommended and implemented tape backup strategies, then removable hard drive strategies like the Dell RD1000 drives to my customers.  I made very little margin on the sales of the media and the upkeep of software such as Symantec’s flagship Backup Exec.

As an online backup reseller, I am now seeing consistent monthly recurring revenue from these customers.  Instead of the small margins on the sale of hardware and software maintenance contracts, I’m generating revenue from providing the actual service.  While the cost to my customers is lower, my margins have increased dramatically.

Increased Interaction with Clients

I can’t emphasize this one enough.  As I regularly communicate the status of my clients’ backups, I’m keeping in touch with the client on a much more regular basis than in the past.  Some of these conversations go off on a tangent and generate either a service call for an unrelated issue or a sale of a new piece of equipment.

Improved Customer Satisfaction

Since implementing online backup services with customers, their satisfaction has increased for at least two reasons they have communicated.  First, they are happy that the offsite-rotation of their backups has been taken out of their hands, lowering their administrative overhead.  Second, they are pleased with the added benefits of using an online backup service, namely their ability to easily restore files from anywhere in the world using the web interface.  Several clients have called me from the road asking me how to restore their presentation, since they either forgot to bring it on their trip or they want to present an earlier version of the file.

If you’ve been thinking about adding MSP services to your arsenal as a consultant, there is no easier way to get your feet wet then to add online backup services.  Take the time to get your client software fully branded, so your customers are also comforted by your trusted name on the product.  You can’t underestimate the value of that.

— The Backup Master


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