Remember that it all starts with trust. If you’re running an MSP, you should be seeking to have a trust relationship with each client.
You need to meet with them regularly and provide value, so they see you as the expert and trust your opinion. If you have their trust it will eliminate a percentage of the re-shopping that happens.
There will still be challenges around quoting and selling hardware. There will still be those cheap clients that shop you every time. Here are some of our ideas on avoiding common mistakes and making the process a little easier.
One thing that makes purchasing and selling hardware easier is to limit your scope a bit. There is an almost endless list of hardware manufacturers out there. You need to choose one at the beginning and make that your standard stack.
There are several advantages. One of the biggest is that if you can standardize on a particular hardware brand, your team will only have to be experts in that. It's much easier to be an expert in one thing than to be an expert in everything.
By concentrating on one brand, you also increase your buying power. Most hardware companies such as Dell, Lenovo, and HP have partner reseller programs. The more you buy from a particular source, the deeper discounts and benefits you get as a partner.
In addition, you will also learn how they warranty and support their hardware. That process is different with each provider. It's much better to have your staff be experts on how to RMA hardware with a single provider than to have to try and relearn that process for every brand under the sun.
Pick the hardware you want to support and be experts in it. There are a lot of advantages to doing so for your MSP. The hardware world is constantly changing, with new models coming out all the time. By selecting a single preferred hardware brand, you make keeping up with those changes simpler.
Related reading: Driving the hardware replacement cycle
Beyond selecting a hardware brand as your preferred vendor, you should narrow the selection further from there. It's recommended that you standardize on just a few models. Maybe an entry model, a more moderate, and a higher-end model for both laptops and desktops. If a client has special needs because they do animation or 3D rendering, you can address those as needed. Most of your clients will be perfectly happy with one of your standard models.
By limiting the number of models, a few things happen. You eliminate the overhead created by trying to sell every piece of hardware under the sun. You have less to train your staff on for both service and support. You can streamline your quoting process by having ready-made solutions for just those few models that you support. It also empowers you to be experts while saving your staff time at every turn.
Increasing Margins and Buying Power
Another huge advantage of standardizing on a few models is that with a little time, you can get a good feel for how many you sell in each month. That allows you to project demand so that you can stock some of those standard models if you like. This enables you to help your clients faster in a pinch, and you can typically charge a little more for machines you have in stock because the clients asking for them need them right now.
There is also a good trick to increasing your buying power. Most hardware manufacturers have some version of deal registration. This is generally reserved for slightly larger orders of 15K or above, depending on the manufacturer. The benefit of a deal registration is a couple of things.
First, you can get locked in prices for a longer-term. Generally, 30-60 days. In 2020 challenges from the pandemic made prices for hardware more volatile than usual. This becomes a problem when you quoted your client a product a week ago, and they approve the purchase today, but your price to buy that product is now significantly higher. Deal registration can help you avoid this pitfall. We also recommend that you put language on your quotes and limit how long they are good for.
Second, by lumping things together into a larger order and doing a deal registration, you can typically get a significant discount. You can keep this as an additional margin, or if you're feeling generous, pass some of those savings on to your grateful clients. Either way, deal registration can help you get the best possible pricing and to make the best margins on the products you sell. It also gives you a little protection against fluctuating hardware prices.
Most MSPs will use a few different distribution channels for purchasing hardware. Common ones are Ingram Micro, Tech Data, and Synnex. They all specialize in different hardware, so it makes sense to shop them all to make sure you're getting the best deal. The problem is the time that it takes can sometimes be considerable.
To solve that problem, we recommend that you take a close look at your quoting software. Many will allow you to connect them with the distribution channels and get real-time pricing fed into your quoting tool. This way, you can do one search and see pricing from all your distribution channels side by side. This makes the buying decision simple and allows you to maximize your margins with minimal time. If your current quoting tool doesn't have this functionality, it might make sense to look for one that does.
One thing that may come up over time is supporting the things that you sell. This is where having a quality RMM/PSA solution in place can help a ton. This should allow you to easily reference all orders for a particular client. Hopefully, the RMM tool will give you serial numbers off the device you can use to get warranty parts and service if it's still covered.
Ensure that you document all your hardware sales thoroughly so that when your clients call with questions, you're ready to help. Taking the time to do this correctly at the start will save you time and frustration later.
Hopefully, these tips have given you some good ideas on how you can save time and money through the quoting and procurement process. Remember that trust is important. You can keep it by not selling hardware for over the MSRP. If your margins on thin on a particular product, consider charging for configuration or procurement instead of selling the hardware above retail cost. This looks more transparent to the client and can help to keep their hard-earned trust. With that trust, they will shop your quotes less and take your recommendations more. Happy selling.
Remember that it all starts with trust. If you're running an MSP, you should be seeking to have a trust relationship with each client. You need to meet with them regularly and provide value so they see you as the expert and trust your opinion. If you have their trust, it will eliminate a percentage of the re-shopping that happens.