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hello and thank you for joining us for today's webinar MSP owners guide to increasing recurring Revenue sales I'm Sarah Duffy the marketing manager here in intronis and I'm happy to be moderating today's session before we get started I'd like to do some brief housekeeping during the webinar if you have any questions feel free to share them using the questions or chat panel to the right of your go to webinar screen at the conclusion of the webinar you will be prompted to complete a brief survey please take a moment to tell us what you think as we are continuously improving the quality and content of our online events now without further Ado I'd like to hand it over to today's presenter take it away Gary hey thank you very much Sarah I appreciate it I'm really happy to be here today and uh talking about something near and dear to my heart which is um something I've devoted 20 years of my life to which is increasing monthly recover revenue for it providers so uh I did this for 12 years in my first MSP uh right here in the Philadelphia area and um made a lot of mistakes that I'm going to share and figured out some things that got us from zero to 7,000 end points under management eventually my company was acquired by mind shift Technologies and uh and then and then after that Best Buy so uh in 2009 I started true methods to help msps grow not just sales but also grow profitability and um oh one more note I invested in another MSP uh about 5 years ago and I'll talk about kind of where we are I I don't work in that business we have a young owner uh who um you know runs and works dayto day in that business so from all counts this is pretty much how I spend all my time is uh is working on uh all aspects of profitably growing uh uh it providers so today what we're going to talk about you know this owner's guide is really about the math and science of top MSP performers like what are some of the things that you can do even before you start to increase your chances of success we're going to cover a lot today Sarah so if people feel they need a little bit more help because we're going to move fast um they can send an email here to gary. promo true methods.com and with the subject line promo and I'll have someone from my team spend 15 minutes with them and ask them like six questions about their sales process and give them some pointers in the right direction so um it's absolutely free you have to put a credit card in or anything We're just trying to help some people out so here let me start with describing my MSP sales Journey it started out as complete failure I I went on and I had had an exp you know a a sales career before I bought my MSP and it was so different selling managed Services than all the other products that I had success in selling and at first I couldn't figure out why I was going out and explaining things I thought it was good people seemed interested but I wasn't closing deals so we made a few tweaks and changes and applied some elbow grease and discipline and went from complete failure to Total mediocrity and we got stuck there for a couple more years then I figured out some of the things I'm going to share today and we got to uh started having more success and eventually repeatable success right trained not just myself but other people in in my business on the process and once that happened that's when we quickly um you know scaled the company and did it profitably in command at a higher price when I do live events I always ask this question number one is selling new Mr monthly recurring Revenue one of your top goals if there's 150 people in this room in the room 150 hands go up that that is one of their top goals then I say well how many people are doing it and I qualify by saying that you're um you know adding at least on average maybe one good customer that's worth between two and 3,000 a month every month consistently and almost no hands go up well some hands go up and I say that aren't a true aren't working with true methods and very few hands go up how many businesses do you know like Industries where everyone can agree on their top goal and no one can can do it so what we want to do in the next hour is raise people's expectations about what's possible and get down to some real meat of things that people can apply so if you think about the math and science and I love I try to apply math to everything that I do um to make sure that uh I can track my results top msps they're more efficient in other words they don't expend as much money time or energy to get recurring Revenue as average msps and there is Math and Science and impact results that will allow you to make your goals more achievable or if you don't understand it almost guarantee that you will not reach your goals before you even start and you'll never know it so I want to cover three important definitions that we're going to use uh to start things off here the first one is called an FTA and this stands for firsttime appointments so this means when you engage a prospect and you get in front of them for the first time or the first time in a while maybe it's someone you met a year ago and now you're back in front of them so someone who you're at the beginning of the process to investigate whether they might be a fit for you so that would be a firsttime appointment your close ratio is the ratio between the number of firsttime appointments you go on in a period and the number of new agreements or sales that you have and then the third thing is average Mr this is the average monthly Revenue per client so on average do they pay you a th000 a month 2,000 a month 3,000 a month and that's a also a really important number because this is this is the recurring Revenue sales formula um the when you set a goal for monthly recurring Revenue it equals the number of first-time appointments you attend times your close ratio times your average mrr so the example would be if you set a goal of $36,000 for the year of new monthly recurring Revenue that you want to sell and you go on 75 first-time appointments over the course of the year and you have a 20% close ratio and each of those is worth about $2,500 you would that it's a little bit more than 36,000 so you achieve your goal so what I want to do is I want to look at the impact of Clos r ratio and average mrr and what role they play in making your plan achievable or not achievable so the first thing we'll look at is average Mr this is your average deal size so if your average customer spends $500 a month to achieve a goal of $36,000 you would need to add two clients a month 24 clients over the course of the year if your close ratio was 20% you would need to go on 120 firsttime appointments if your average is 2500 you would need just 15 clients at that same 20% close ratio uh you would need to go on 75 first-time appointments over the course of the year and finally at 3500 a month you'd need just 11 less than one a month with that same close ratio and only 55 and most people are much more likely to be able to find 55 good prospects than they are 120 over the course of the year so focusing we're going to talk about what drives this but obviously focusing on this is one thing that I did with both of my msps when I got to my new MSP their average uh deal size was under 2,000 and now five years later our average client spends uh uh almost $4,000 a month so we'll talk about what we did and as we've done that we've also been able to um achieve our sales goals because we need we can be more focused uh and really focus on the clients that have the right value okay okay so the next thing I want to do let me see if I got the right slide here I do okay so the next thing I want to talk about is the impact of close ratio and this is and and we're going to talk uh we're going to dive deeper into the type of lead you're looking for and what and what are the things that affect close ratio but if you close if you have to generate so many ftas like 150 like uh like the top person here and you have a 10% close ratio right to get those 15 clients even with a $2,500 average Mr you need a lot of first-time appointments you need twice as many obviously as someone with a 20% close ratio so if you combine these things and this is normally how I see it in the real world the people the lower your average um contract value usually the lower of value you have to your clients and lower your close ratio so someone with a 10% close ratio and a $1,500 average they're never going to get there you're not going to generate those 240 leads as opposed to the other end of the spectrum of someone whose average deal size is 3500 with a 20% close ratio they only need 55 so most people fall somewhere in between these you know the 55 and the 240 the lower amount of ftas that you can have to achieve your goal by doing things that impact close ratio and impact average Mr is the shortest distance between you and what you want out of life we haven't even got the profitability yet but um we'll talk about that as well okay so now let's look at these two factors that impact sales math average Mr and close ratio and what are the things that determine those well the first thing that determines your average mrr first is your value proposition so if you can command a higher price let's say $150 on average per seat instead of a 100 uh that's going to have a Major Impact even if you sold the same size clients your average Mr will be higher because of your value proposition okay um minimum mrr so you H everyone should set rather saying we only deal with clients that have at least this many workstations or or other categories instead just say look we don't you know we'll do business with anyone uh but they have to be they fit our you know our generics in terms of where they're located in their technology stack and their industry but uh if you can't spend x amount 1,500 a month 2,000 a month if you can't spend that minimum then we don't we don't consider you you know a great Prospect for us so um if you're smaller today you may have to start with a lower minimum and then over time as you build value you can raise that minimum so we see many people that are small maybe they start with a minimum of a th000 then they get to, 1500 then eventually 2,000 in my MSP we don't like to take any contracts that are under 3,000 a month we will take them down to 2500 but usually it's because we think the company is going to be good long-term C customer they really fit you know our mold or they're in an industry that we're trying to build and they could be a good referral partner for us and then Target the right prospects so look for those companies that fit that mold so that you can be more efficient then on the close ratio side what impacts close ratio um value proposition if you can separate your services from others and they see a clear difference you're going to be able to close a higher percentage of those deals the second thing is lead quality not All Leads are created equally and we're going to talk about the the from a high level what the different types of leads are and how you target to be able to increase increase close ratio then the last thing is sales process you have to have a defined sales process and the best way to describe this is is that um if you were to hire a salesperson to only sell monthly recurring Revenue today in the first couple weeks would you be able to describe exactly what they need to do throughout the sales process when they get in front of a customer what's the first thing they do the second thing how would you know whether they did a good job and if you can answer yes to that you probably have the beginnings of a sales process if your training program would be just Shadow me and listen to what I do and try to do it then you don't have a sales process today and that's going to lower your close ratio so let's take a look at this and and look at we you know we talked about the uh the impact that value has on price so here's two msps that both have 50 clients that average 20 seats the one in green on the top um they command they have higher value and they command the price of $140 on average per seip and today um msps that we see top msps are between 140 and 165,000 some are higher if they're in a vertical or they're heavily uh have a lot of Cloud components but um that's pretty much where top people command their price so those 20 um those 50 clients would generate 140,000 a month of recurring revenue on the bottom there's someone who only commands a price of 95,000 so the first thing is you see their average Mr is lower so that makes their sales goals tougher but the other thing is look they're both managing a th000 seats but one's generating $45,000 more per month so think about the impact on profitability that this has on companies and this really tells the story of what I see and today at true methods um between our coaching and our software we work with uh about a thousand msps around the world and that we see in every Marketplace we see both of these companies so obviously value proposition is super super important and here's kind of the thought process on it what's the value of your MSP offering and today what it is if you take all of your monthly recurring Revenue divided by all of the seat you support that would be your average own seat price that's the value today that your customers see so how do you raise that value and can you separate your offering from others so here's a little email or conversation that I had and I probably have been on in my first MSP um I probably was on over 1,200 uh sales calls during the 12 years or more um that I own the MSP and I had this conversation a lot hey Gary your price is $1,000 a month more than the other two vendors what gives love a skeptical Prospect and this happened a lot we'd go in and we give a a quote of you know 4,000 a month and they'd be looking at three vendors and the other two were at $33,000 a month and so here's how the convers would go and then explain to you how you get there so what I would say to them is well do you think that you know we talked about two or three things that are an issue in your business from your technology a couple of them you felt were really important like they were you told me they were impacting your business do you think that all three of us can solve those issues are you 100% confident that all three of us can get there because if you are you shouldn't spend a ,000 a month more in fact you probably shouldn't spend a dollar more and then this particular case the one that I'm thinking of he said well no we do think you're better but $1,000 is a lot of money so I said well what if the difference was only $500 would we be having the same conversation and he said well probably not so right there I cut the delta in half so then I said okay so you're spending you're concerned about spending $500 more than you'd like to do you remember we talked about our process and what we do and how we impact those things that's the reason we charge a little more do you remember those conversations said yes well then let me go back to say if you knew the only choice you had was to spend $500 more than you wanted to or not guarantee that you would solve those issues if that was your only two choices what would you do and he said well obviously I would spend the extra money and so at that point all I had to do was go back and tie our unique process some of the value that I'm going to explain to you now back to it and we closed a nice percentage of those deals so that was kind of the logic so I wanted to start off with that and then take you through this concept of value based pricing and what most msps have is what I call Technology based pricing they're building their value on features tools and support and today in a maturing Market they're the same features the same tools and the same support that everyone else has or says they has have as a Pros to Value based pricing and value based pricing is built on the the business impact that you can uniquely make on your clients different that you can show them is different than what other people do and that's how you command a higher price and that's how you increase increase your close ratio so it's like I there's a concept we use called reframing it's the ability to reframe clients by showing them the impact of what you do on big cost in their business I love to use this to explain it it comes from the book predictably irrational and if you look at this these two green dots are the same size but the one on the left looks larger because it's surrounded by relatively smaller blue dots that's your service offering that's your monthly fee so if you surround it by smaller blue dots like my example where I was 4,000 a month and uh the competitors were 3,000 a month at first glance my DOT looked huge but then what I did is I started to surround it with larger blue dots and if you think about one of our customers someone who's spending you know who has 30 users and is spending $4,000 or $4,500 a month with us that same customer probably has you know three or $400,000 in payroll taxes overhead so compared to all their expenses whether they spend 3,000 with us or 4,000 we're relatively small percentage cost to them and if we can show them how that investment can impact making their people more productive lowering their risk solving things that impact those big costs if we can make it even without an Roi calculator if we can just logically show them that we have an approach and a process that's different that can impact those things it can quickly eliminate price as an objection I like to use this analogy between a grocery store or a bakery if you think about a grocery store every grocery store has basically the same canned items when you walk down that aisle and you may like one grocery store over another but you're not going to spend 60 cents for a 33 Cent can of beans for this reason uh grocery stores are a high volume very low margin commodity driven business now if you think about a bakery they also use all the same ingredients every Baker starts with the same basic ingredients but they combine them into their own unique recipe and because of that most people I know that I drive past two or three other bakeries to get to the chocolate cake that my wife wants when we have a party uh in fact that'll happen this week I have a daughter who's gradu uating from uh from high school and for the party there's a specific cake she wants and I'll drive past two or three other bakeries and when I get there I don't really care whether it costs $35 or $30 for that cake that's the cake that's the recipe that we want although it's made from the same ingredients that all those other Bakers use so the question is are you an MSP or are you a reseller so are you just selling or bundling the same stuff that every single person has and that's what people are comparing you against or are you combining them what I would call your superpower into your process and your recipe in a way that a prospect can simply and easily see the difference in other words if someone be willing to drive past two or three other msps to get to yours and pay a little bit more so when you think about your support offering it's focusing on that end result of combining your people in process and technology and creating a true competitive Advantage I call that your superpower if you're going to do that you're going to limit your choices and offering I see people they have bronze silver gold pwor tin they have all of these different offerings and I ask them you know you can have it with or without virus with or without backup well I said well what is the right one what's the one that if you they're paying you the right amount and you have the right resources to use your process that can impact their business result in a predictable way and they say this one well why do you have all the rest and they usually say because that's what you know people want choices and that's what they'll buy but many times the people that I'm asking the question they're not selling a lot of recurring Revenue so my thing is um why not why don't we decide what someone needs and explain it to them in the right way they can't get our results their way and if we have a result that we want to deliver there isn't 20 different ways to deliver that result so um the joke that I tell is at my MSP you know uh we have one offering but you can have it in any color you want as long as it's black so so obviously one of the keys to this is the bundling of services you want to figure out and we teach a process in my training program we call it microeconomics to take all the services and all of the um technology and tools you want to bundle and a way of determining what your average cost per seed is is so that you can Target the gross margins you should be looking for which uh should be between 70 and 75% uh gross margins a and so there's a process we go through but that key is the bundle those services so that you can show them like that bundle um has a result and what binds it together that is makes it your chocolate cake so I mean one great example of this is intronis so uh being able to take your your um your backup disaster recovery and make that part of your bundle uh that's a great example of something that you want to work towards if you're not doing that today because we don't really want to sell them backup we want to sell them what comes from really what they want is um they want to know that if they have an issue that they can recover from it they want that end result so um if you're not using intronis today you can get a quote Go to anon.com No Limits and um you can get a quote today on that so that's a great place to start so think about it this way from a higher level look at your product offering that you have and ask yourself how much of what you're selling in your monthly fee is what I would call it's and this is all important stuff but it's everybody's stuff Pat spy spam virus backup help Nets cloud services they're all critical I mean they're table sticks you have to be able to do them and you have to be able to do them right but everybody expects that you do right so all msps if they're not they should be doing all those things and how much of what you're showing is unique to you your best practices your standardization your technology alignment and business process your business strategy those things that really are the process um or the recipe the superpower that you wrap around that because because if really what you're selling giving people choices on is the things on the left-and side I'm going to guess that you're feeling competition your prices aren't as high as you lik them the B Be Your margins aren't as high as you like and your sales model continues to be a struggle as you can move more over to the right all of those things start to fall away you start deciding the customers that you want you get a higher close ratio price is no longer the main objection whether they're going to spend you know 3,000 or 2500 isn't as important to those prospects as you start to show them how your offering is going to impact those business results it really changes everything and when I talk about that you know my experience in the industry here was a major change when we went from Total mediocrity to success I mean we had got to the point where we were bringing on you know two three four customers a month using the same sales process I was the same person with the same sales experience that I had two years before when we had almost uh very little a fraction of that success so here's what changed I was in there trying to tell them every day when I went out in front of people about how great we were how great our people were how much experience we have how great our tools were all of those things when I started changing that and saying listen let's talk about some of the issues you're happing and the impact they have on your business which is this their results then I talked about what it would look like what my customers have when they don't deal with any of those things and ask them to simple question what would your business look like would it be a benefit to you if you didn't deal with those things if they were to go away this is before I tell them anything about what we do or how we do it would that be of value to you and if it wasn't and they didn't need better results and they can live with what they have now we moved on quickly we got out of there but if they saide I don't want to have these issues you know give you an example they might sayl we have a vendor today and our line of business app uh server it reboots itself during the day every two to three weeks and they can't figure out why this happens so okay so what if you were assured that those kind of things others would never happen would that be of value to you is it enough of a reason to make a change would you invest a few dollars more so first we get them to determine what the value of different results are and then as a second step we show them our processor our superpower and explain to them that their issue is not the issue it's a result of the issue and that other vendors who are going to come in with the same approach and the same price you know no matter what they say the only thing will be different is their intentions and when I started breaking it up into these two steps first results then our unique approach and I had both of those everything started to change change so I get a call from one of my Formula 1 that's our training program one of our true methods Formula 1 members and says listen I just sold a client 3,000 a month when a year I was out there and I pitched them at 1800 and they said no I said well what changed he said I did a year ago I was out there just trying to tell them all the great technology and how great we are this time I spent the time talking about their business and where they needed to be and explained to them how how we would solve those issues and the way in which and why the investment was a big part of how we were going to do that and they signed the agreement on the spot for 3,000 a month and he said I got out to my car and it's like the sky opened up and I said it's easier to sell the right program at the right price than it is to sell the wrong program at the wrong price and I said 'well I've been telling you that on our webinars twice a month for a year and you saidwell I know but I didn't believe you now had this um uh client of mine been out in front of this Prospect and the minute they push back on the price if he would have said to him well if you don't want to spend 3,000 uh you know what I can just sell you for 1,800 in my crappy silver program uh he wouldn't have got the 3,000 and he probably wouldn't have got a signed agreement that day day and he would have thought how wow sales is really hard and he would have thought a bunch of other reasons but because he approached it in this manner he was able to get the right customer at the right price so let's get down to some of the brass tax here first thing you got to do if you want to sell more recurring revenue is you have to set an MR an annual monthly recurring Revenue goal in our example we use 30 or $36,000 as a basic goal and then use the ratios use close ratio and average Mr to determine the number of first-time appointments so that's the starting point based on your assumptions you have to set a goal for how many prospects each month and each week that you need to be in front of and that's what you're going to work towards is achieving that then focus on building your value proposition or your superpow so that you can make your close ratio higher make your average Mr higher so that you can build become more efficient the way to do that is to build a warm lead generation engine and I'll talk about that so here's something we use in our training program it's a sales goal calculator you put in your annual goal in this case 30,000 a month then you put in your average uh contract value I use 2500 a month and a close ratio of 20% so and I would say if you're in the recurring Revenue business you shouldn't set a goal for a year much less than $30,000 that's achievable for everyone who has focus on the right things over a six-month period everyone can ramp up to that I'm I've seen it over and over again in this case to get to with that average Mr and close ratio you need about One customer a month 12 12 over the course of the year then with that that means that based on that close ratio you need about 60 firsttime appointments for the year about five a month so a little more than one a week and that seems like an achievable goal anyone can get there all right to be able to get to the point where you get in front of roughly one New Prospect every month but here's the key to getting there understanding that not All Leads are created equally and understanding the difference between a warm lead and a cold lead and where you want to spend your time so cold leads are ones that may not have any establish uh need uh maybe they hit your website and the way your website's designed um there's a bunch of reasons why they might raise their hand not all of them are that they're looking for a relationship with somebody um to buy at the right price or solve certain problems warm leads are people that have a need this would be like a referral so someone gets referred to you you know at least they're looking to make some change or they have some need and then the highest close ratio you can get or what I call returning prospects these are people that you've already met with uh you didn't sell them at the time the timing wasn't right or maybe you didn't have your value proposition at the time but the next time they're willing to take a meeting with you and they engage and they know something about you you're going to close a high percentage of those so if you think about it this way you want to think about H have your prospect datab base as at the top or suspects these are people that we've not even confirmed whether they would be a perfect Prospect for us then there's prospects we know generically they fit they're in our geography they're the kind of companies in in the industries that we like they're about the right size their technology stack and then below that is our warm 250 this is a few hundred companies that we know a lot about not just the generic stuff but we've spoke to them we've met with many of them and we know they're a perfect fit for us we just weren't able to get them to see it our way yet but these are people we feel like at some point we can do business with and at the bottom is our Hot Prospects they're the ones that we're currently engaged with and they're going to make a go or noo decision in the next 30 days what I see when I meet people that don't sell a lot is they hopefully have one or two people at the bottom that got referred in and then they have a bunch of people at top that are suspects but they have nothing in the center and if you want to build a consistent um flow of new customers at the right price you have to focus on activities that build the middle down to the bottom of this funnel with discipline over time and once you do amazing things will happen so warm G lead generation sources when I got to my MSP the new one they didn't have great sales results so the first thing I did was I got our young owner focused on these three things one what we call cois we teach this process in our training program centers of influence how to find people in your Marketplace that have the same target market as you do deal with the same basic size customers and they deal with the same decision maker that we want to get in front of and for many times for us you know we're dealing with like for at my MSP we want companies between you know 20 20 to 80 users is our sweet spot although now that we've gotten larger and scaled we can deal with customers between 80 and 250 but so we're looking for people that have that same target market and they deal with the same person um that we would and uh so what I said my MSP was I wanted our owner to be in front of one potential new center of influence every single week because you have to get through a lot of them to find one or two you can develop a close relationship with and one way to find those is to talk to your clients your best clients the one you want the ones you want more of and ask them hey who else do you deal with that you love as much as us and and then say because there's a good chance that if they love that customer that they have that that vendor would also have more people like that and ask them if they would make an introduction the next thing is referral programs most people in this industry live off referrals the problem is they don't get enough of them and the referrals might not be your target market hey I have a friend of mine who said you know they need help with it and you find out they have five users and they can't meet your minimum so the way we solved this was we teach a process around LinkedIn so the owner and now the salesperson that we have at rmsp they can talk with our customers find out if they' be comfortable referring us and then be able to say to them hey I was looking through some of your LinkedIn contacts and I saw like these 10 companies that we would like to get an introduction do you know any of them and they'll say well I I know these two great tell you what I'll send you an email um that you can just cut and paste to send to make if you could just make the introduction I'd appreciate it and they're happy to help so people want to help us they're just they can't think about the whole big world of people that they know to come up with a name but if we help and guide them so this has made a Major Impact probably doubled or tripled the amount of quality referrals over time that we get today compared to when we started so these kind of targeted warm lead generation sources are going to get you people that are have a higher close ratio and are more likely to close sooner uh the other thing that that we teach and uh have added I call inside sales and we actually have a community of about a 100 inside salespeople that work for msps of our members that um that we have a call with once a uh a month and um they have a relationship and they have a chat that we have on our portal that they use but here's what inside sales is it's not just telemarketing this combines two critical functions one is lead generation they generate you know three or four good appointments a week um but it's also sales database management so they're not just trying to get leads they are talking with suspects figuring out who's a prospect talking to prospects figuring out who would be a really great fit for warm 250 so every day they're making and building the center of your database so again when I got to my new MSP um we hired an inside salesperson um we mainly focused and made our plan off closing the warm leads the first year because our list was cold and needed work but over time this warmed up and now we have great information about a lot of people in our marketpl place so um the amount of leads and the quality of leads we get today um as we made this investment has been huge in kind of supercharging our sales efforts so here here's another story I I love this one um I get talking to one of my members he said he just um sells a customer at 2200 a month when the competitor said they could do the same thing for, 1500 so uh he goes and gets a referral and he goes and meets with the decision maker and at the end of it the guy says that sounds awesome come back on Friday when my partner is here and we'll sign the agreement bring the agreement so he shows up on Friday and his contact comes out and he says hey man we got a problem my partner also got a referral and met with them and they can do they said they could do basically the same thing for 1,500 bucks so my member said well what are you GNA do he said well I still think you're better so I want you to come in and meet my part partner tell us again all the great things that you do we're going to think about it for the weekend and let you know on Monday and he said to me you know he's like Gary I thought about it and I said uh I don't think that Gary would like me to do it that way so he says to the guy well maybe you don't have to wait until Monday he's like what's the issue is it that you don't think you need $2,200 support you only need $1,500 support CU if that's the case why don't you just buy the $1,500 support from the other guy and just enjoy your weekend or do you think you can get $2,200 support for 1,500 bucks which is it and he said the prospect just stared at him for like 20 seconds and then said I don't know which so he went back and he sat down with him and his partner and he explained to him his superpower his unique process why people invested a little bit more with him what the issues they were concerned about that were going to impact their business and how we tied him back to his Prospect and 45 minutes later he walked out with a signed agreement for $2,200 so I said to I said to him what' you do in that 20 in that 45 minutes that you didn't do in the first hour you spent when you were there earlier he's like it was referral I just figured they were warm and all I did was just go in and I just told them all the great things we do so understanding that difference of talking about results first and then tying it back to Unique process second is what creates your ability to separate yourself and command this higher price and it really is the story of our industry why right now today there's more recurring Revenue being sold at a higher price than ever before by the top people while the average providers are still in the same place that they were which is they're struggling with sales they're struggling with commanding the right price and the concepts we talked about today and creating that superpower which is something we really work with on when we get someone new to comes to True methods is really the key and can save people years of their life you want to be in this story the person that can go in there in that 45 minutes and explain to them what the difference is between their offering and the thing that someone else told them was the same thing MSP efficiency average msps are spending too much time and energy to get mediocre results um not just in sales I see people they're just running around Marketing sales all this energy but in terms of getting the right customers at the right price they're getting very little results and the same thing they have five employees 10 employees 20 employees they have all of this payroll all of this risk everyone's doing tickets everybody's busy every single day and when they get to the end of the month after a true owner salary they're showing a profit of 5 10 12 14% so it's all of this risk and effort and so when you think about this efficiency they're creating such a long road to success that over time it wears them down if you can focus on value proposition you can dramatically impact your results that's the key to this so here's what I mean let's say that I told you look I'm going to give you a managed service provider all right I have two you can choose from one of them has $3,000 or $3 million a year in revenue and the other one has $1.2 million a year in Revenue which one would you like me to give you now if this is all the information that you had you would take the $3 million Revenue business everyone would it's a bigger business but now I give you the rest of the story the $3 million business is a 10% true net profit after owner salary so it generates $300,000 a year of profit the $1.2 million business is at 25% net profit it also makes 300 now which one would you rather have and uh I would pick the $1.2 million business still make the same owner salary the same $300 of profit and be home for dinner and by the way if I could figure out how to get this business to three million okay um at that point I have a business that makes almost you know approaching a million dollars a year right with that kind of efficiencies and that's what this is about um when I ran my first MSP uh and we finally scaled we ran at 33% net profit so I meet people like this every day that have been business for 15 20 years have defied the odds to build a three to five million do business but based on their profitability I have true methods members that have half of the revenue or less and make as much or more money and so you want to start with this concept in your business before you put a sales plan together you want a sales plan you want a service delivery plan you want packaging and pricing that everything you do is geared towards your efficiency otherwise you can get stuck in that what I call that Quagmire of mediocrity for years I've see people I meet people that have been in the business for 10 years and they have a good business it's not that they're failing that you know they have a good business they make a decent living but they never get over that hump to really have the business generate for themselves and for their team members what's possible in order to obtain a level of financial Independence for themselves and Financial Security for their team it just doesn't happen at 10% and so when you think about a sales plan your sales plan has to support that efficiency Your Service delivery and how you design each Service delivery role how you package and price those all of these things have to support this efficiency so I want to go now back to the slide that I used earlier and really think about this and and think about where you are today in your business right of one MSP that commands a price of $140 a seat and generates the 14,000 a month to manage a th000 seats while the other MSP only generates 95,000 a month for the same thousand seats and guess what here's the worst part of the story the one that only generates 95,000 they have more reactive tickets and alerts they actually have more noise and cost because they don't have the extra money every dollar they get is going into solving tickets alerts and doing projects as opposed to the person who has the commands the higher price where they have the time and money to have resources to actually make those business relationships so customers make more of an investment they can spend more time on technology standards and Alignment that drive down ticket noise and increase the value to customers it brings up their productivity it drives down their risk and they're willing to look at Price differently so to me this slide really says as much about where you are comparing yourself to where you are and making some plans on where you want to be in a year or two years from now so here's what I mean by MSP efficiency at any Revenue level you want the fewest amount of clients the fewest amount of endpoints uh you want the fewest amount of reactive tickets and the fewest amount of employees at any given Revenue level that's what's best for you that's what's best for your customers and also it's what's best for your employees if every time you add revenue and think of it this way we have a little thing you can check we call it leverage take your annual service Revenue whether it's recurring revenue or non-recurring Revenue all services just don't count your products or Cloud things that you resell just service revenue and divide that by the total number of employees in the business everyone that you pay including yourself and see what that number is the average MSP generates around $100,000 of service Revenue per employee so if they have 10 employees they generate about a million dollar a year of Total Service Revenue top msps generate 150,000 or more so the same 10 employees they would generate an additional $500,000 of service Revenue so that's a quick check checkpoint that you can do right now to gauge what your MSP efficiency is what I can tell you is everyone that doesn't have high efficiency based on their leverage has more struggles in sales they tell me they just need more leads but more leads is not really the issue it's usually a result of the issue that's much deeper in the way that they look at the business look at their efficiency and most importantly the way that they look at their value so here's what you need to do you want to start right now by defining the most efficient plan to get from where you are to where you want to be so use the math that we gave you in terms of Mr equals firsttime appointments times average Mr times your close ratio and think about the formula that you need to build a plan that actually yields the Mr you want and a reasonable number of first-time appointments that you could build to then what you're going to have many of you will have to do is work on building your value to match your plan you may look at it and say listen I can't get there at $100 a seat I need to be at $140 a seat if I'm going to be able to have a formula that I can actually deliver on and create a reasonable number of firsttime appointments then you'll be able to increase not just sales but profitability this is the Gold Rush there has never been more recurring Revenue in my 20 years of owning two msps and working with over a thousand of them there's never been a time where the availability in every Market is to sell more recurring Revenue at a higher price today so this is the time really right now is the time to do it so I'll answer a couple questions but um real quick I want to tell you why people do business with us here at true methods based on our training and software programs we help people build a true superpower develop sales separation consistently build recuring revenue dramatically increase profit margins and ultimately what I'm passionate about is helping entrepreneurs Achieve Financial Independence for all the risk that they take and help them help their team members achieve a level of Financial Security we do that by we have a training portal that is over 200 hours of content on every aspect of this business doing a business plan doing a sales plan building a superpower Service delivery um design and Metric packaging and pricing we have a community with forums and uh an event called schnizzfest that we just had last week we had 300 of our members from around the world come and spend two days with us Us in tronus was there with us as well uh and we have tools uh there is a tool called MIT process which is a framework to build a superpower we show you what numbers to look at we give you templates and playbooks so really all these things and it's just a monthly subscription so you can learn more about it or if you want we'll just give you some free advice if you send an email to gary. promo true methods.com there's Noe and true with the subject line promo we'll start by just asking you some questions about your sales process and point you in the right direction and if you want to know more about what we do and our subscription services our team will be happy to tell you that as well and also again um if one of the things that you don't have nailed down is your backup and disaster recovery and you're not figuring out how to get this thing really bundled in so that you're using the solution that's the right solution for every single customer uh talk to the people at intronis uh great way to start is go to intronis decommits you can get a quote talk to some people that are knowledgeable and um they have an awesome offering that they can help you with and they know a lot about this business so in terms of uh what you should do and how you should do it they can give you they can give you a lot of advice as well so um we just have a couple questions that that I want to answer before we end if you have one you can type it in now but the first question that I got here was hey you covered a lot of information it's a little overwhelming you know where should I start so you're going to get the recording to this you might want to listen to it one more time that might be a good place to start um talk to us at true methods we'll point you in the right direction um but really to me what it is is you have to step back from your business and you have to put a business plan that makes sense first and then a sales plan that supports that and you have to make sure you use the math that we gave you that your plan is achievable if you're generating you know two or three good firsttime appointments a month and your plan says to get there you got to generate you know 20 a month in the short term that's probably not a good plan you need to go back to your formula and maybe you need to spend your time on increasing your value looking at your packaging pricing and trying to see whether you can get from a plan to get there that's 20 uh firsttime appointments a month that you can get it down to five to seven so that it looks like something that with maybe over a couple months and focusing on some of the warm bed things we talked about is reasonable and you can get there because if you set a goal and you haven't thought through the math and you just go after it and you fall short every time it's demoralizing and you think that it's not possible because you didn't have the right focus on the right leads you didn't have the right value proposition and so you didn't prepare yourself for Success so that's the number one thing that I see um one of the things people come to our training program the first thing we look at is um besides their leverage and their efficiency to gauge where they are and show them what that means we look at their packaging and pricing and get that on The Fairway so that they can start to build some sales math that makes sense so uh somebody asked to send the slides I think uh Sarah what you're going to do is you're recording this right and you're going to let people go back and watch it again that's correct yeah so everybody will be able to go back and and rewatch it so all right so we're almost at the top of the hour hour here unless we have any other questions I think we're good to go Sarah great well thank you Gary for taking the time to to go over some different options and ways to improve reoccurring Revenue it was a great great presentation here hey thanks for having me all right and I want to thank everyone for joining us and have a great day