The increasing costs across the supply chain, in particular the high price of oil and other rising input prices continues to be a source of increasing inflationary pressure. Most of us are already feeling the pinch and according to Gartner Research, businesses have to employ an agile and responsive strategy to allocate resources efficiently to tackle these pressures while working to achieve their business outcomes and targets.
The good news is that even in a volatile and uncertain economic climate, the IT services market is set to grow by 7.9% in 2023. MSPs across the country are well placed to take advantage of new opportunities for business growth throughout the year even as worries of a recession and increasing interest rates play havoc on the markets.
Here are three significant trends that we’ve identified for 2023. Keeping an eye on these changes will help MSPs stay agile and responsive in what looks to be a challenging yet promising year ahead!
1. Higher pricing and sensitivity
For MSPs, changing economic pressures translate to taking a more tailored and thoughtful approach to raising prices rather than implementing blanket increases across the business for all clients. It’s important to gauge clients’ price sensitivity and protect your most profitable customers. This means MSPs have to judge which clients may be the most willing and pre-disposed to sustaining an uptake in costs.
In the long term it is typically wiser and more cost effective for MSPs to keep an existing client happy and weather a decrease in margins, rather than go out and start from scratch looking for new business.
In the context of increasing costs, when MSPs do need to increase their prices to ensure their bottom line and the quality of the services they deliver to their clients and partners, it’s important for them to approach existing customers with detailed and precise explanations to justify any price increases that they decide to pass along.
2. Increased SMB cloud computing and outsourcing
Moving to cloud-based or hybrid IT systems is beyond the scope of many small- to medium-sized businesses (SMB) looking to implement a digital transformation that will optimize and upgrade their existing technology.
This is a potential boon for MSPs. Their expertise will be in high demand in these sectors, many of which do not have dedicated in-house technology experts or teams and where increasing financial pressures may make it difficult to hire an IT manager, let alone a Chief Information Officer (CIO).
These kinds of SMB organizations will become increasingly reliant on the expertise of third-party IT providers who have the insights to guide technology spending decisions and support implementation of new systems. Once these upgraded systems are up and running, these third parties also have the expertise needed to service them.
MSPs represent an increasingly permanent solution for many SMBs as the demand for interim IT expertise grows. Working with MSPs is increasingly becoming a better long-term fit for small or medium sized businesses who simply don’t want to allocate the resources needed to hire full-time, in-house IT professionals.
3. Optimizing growth in 2023
For businesses looking to maximize efficiencies and improve their technology systems, the predicted 5.1% expansion in IT spend in 2023 is likely to translate into a more cautious approach to infrastructure investments.
With the continued stress on skilled labour, MSPs are well positioned to offer their expertise to companies unwilling or unable to do the work in-house. As systems grow and expand so does the need for the critical expertise to ensure that new technology can be implemented and maintained.
For the MSPs who’ll be doing this work, one of the key advantages of the Liongard Deep Data Platform is our technology’s ability to enable MSPs to scale up the amount of work they take on without the need to hire more talent – preserving the quality of the service offering without cutting into tight profit margins. MSPs can use this data to leverage ongoing growth in the sector.
Additionally, the Liongard Deep Data™ Platform significantly lowers costs by automating processes while increasing the speed of discovery, documentation and auditing of client IT systems. This ensures customer satisfaction and helps MSPs manage the costs that drive profit.
By centralizing visibility, automating the inspection of key elements and enabling insights in a consistent manner, the Liongard Deep Data™ Platform frees up more MSP team members to focus on revenue-generating activities – allowing MSPs to grow their business and delight their clients and customers.
Learn more about Liongard here: take our self-guided tour.