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What Is So Special About Managed Service Providers’ Billing

Sep 17, 2021 8:45:00 AM

Since MIT offered the first Managed Service Provider (MSP) functions in the ’60s, the industry has grown and evolved tremendously both in revenue and in the offering. Today, the MSP business represents a 242,9 billion dollar market and it is expected to grow to 354,8 billion by 2026 (1).

What makes MSP billing special, and how can you, as an MSP, capitalize on the growth with the right billing? We cover these topics in this blog.

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Hidden Complexity And Billing Simplicity

As the role of an MSP changed from problem solver to enabler to trusted advisor in IT, so did the pricing and billing portfolio they offer to their clients. 

Many MSPs find themselves with:

  • large service catalogs, 
  • complex pricing, 
  • endless billing rules, 
  • and pressure from the big cloud, software, and hardware providers who demand pricing and billing execution from their MSP partners. 

All these variables must be processed and presented in an efficient way. But it is not just a burden. In its recent study, CompTIA describes the pricing opportunities MSPs have to better align with their customers (2). 

What Am I Paying For?

With so many service items to offer, it is easy to lose track of billing items. But more troublesome is that clients no longer understand what they are paying for.

Often, MSP pricing is based on the logical driver: per device, per user, per service, and possibly on different service levels, fixed or per hour. Clients won’t always agree on the pricing metric or feel that they can control the cost of MSP services.

New offerings need to align with customer expectations and their fixed budgets. In short, clients want no surprises in their MSP’s monthly invoice.

Getting The Best Out Of Your Infrastructure

When talking to COOs of MSPs, we typically find that their operational processes are highly optimized. The service catalogs and service databases are up to par, the RMM and ITSM systems fully operational and their teams well managed and professional.

The issue is translating all these elements from contract to billing items. Leveraging and integrating the existing data flow into billing and automating billing events is the key to successful cash flows and quick integration of new services and pricing.

Future Proof Your Billing And Speed Up the Cash Flow

An optimized billing solution should be fully integrated with your operational tools. It should also allow for pricing changes and have the flexibility to comply with pricing rules from third parties, for example, for Microsoft billing.

As a result, you'll have real-time insight into the charging process for every contract at any time of the month. This way, your clients can proactively gain insight into their spending.

Increased transparency will strengthen trust and reduce questions about invoices, leading to quicker cash flow.

Take Us To The Test!

If you feel your billing needs will outgrow your current billing solution, or if you are just curious to learn how Good Sign does things differently, feel free to take us to the test! We will gladly take on your challenge and prove to you it can be done, and that the new world lies beyond just subscriptions.

More about IT and Agile billing:

WATCH a 15-minute on-demand webinar: It perspectives to a billing system

Hear what Igor Stenmark of MGI Research and Taija Engman of Good Sign discuss about agile billing, subscription, and recurring revenue business transformation. 

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(1) Channele2e web article by Joe Panettieri, July 19
(2)  CompTIA article, 4 Trends to Help MSPs Maximize Business Opportunities in 2021


Petri Takala
Written by Petri Takala

Petri is the Vice President of Sales and Marketing. He also leads Good Sign’s solution evolution for selected industries. Petri is an experienced business leader with a strong background in business management systems within several industries.

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