There is no silver bullet when it comes to generating income in a business so that we can pay our employees and ourselves a living wage.
To build a business, there is no other way than working very hard for our goals whatever they may be. One “catch phrase” that has stuck with me through the many ups and downs of running our business is Passive Income.
What is Passive Income?
It is cash flow that comes in whether we are working or not. One would hope that the retirement fund, if we have one, would represent a form of passive income. Though, with today’s economy along with the taxes we would pay on that income in the long run there really are questions about its viability as a retirement fund in the first place.
Now, obviously passive income does not grow on trees. Otherwise, the beaches in nice places like Fiji, Tahiti, and the like would be filled with umbrella drink sipping folks.
One thing to keep in mind is that once the garden is planted, that does not mean the work is over. It takes a lot of work to come through the growing season with a good yield of fruits and vegetables.
There is not a lot of difference between that garden and working a business in this industry or any other for that matter.
It takes a lot of hard work.
Many have jumped on the Managed Services delivery platform as a way to generate their passive income. The catch to MSP is to balance the value the client receives with the income we receive. That can be a tough balance to catch if we are not experienced enough in our business dealings, hardware support, software support, or have an experienced team around us to come up with some solid costs for the 12 month or longer MSP contract with the client.
So, once we came up with the magic number, the next step was to convince our clients that MSP was the best way to go. In our case, we focus our attentions on the professional accounting industry. It was not hard to see that calculator going in the partner’s heads when we first proposed the MSP model and fees to them.
Needless to say that in our case, we ended up doing a blended Managed Services model with a tiered structure that our accounting clients worked with us on to provide the best value for them and for us.
Not bad eh? :)
Now, we are slowly working our way through the various MSP and related products out there to augment our services offering to provide more value for that monthly fee.
The one gold mine we have fortunately come across is the service provider OWN or Own Web Now.
We have a partnership with OWN as a Services Provider. We are slowly moving our clients over to ExchangeDefender and now are talking to key clients about Hosted Exchange and SharePoint.
One key feature to OWN is the true partnership relationship they have with us. We will never find OWN in our client’s inbox direct selling their services.
They recognize and value us and what we do for their business.
The other very important feature to reselling OWN services is that passive income. We do the leg work to bring our clients on board, we get to invoice them monthly as part of our managed services offering, and Vlad and his crew get to do all of the hard work for us. ;)
Establishing business partnerships with service providers like OWN will be the butter to our Hybrid MSP services hardware and software bread as we move forward.
Ultimately, we get to offer a nice suite of services without having to spend the hundreds of thousands of dollars to provide our clients with some sort of SLA. It is a win-win situation to be in!
Philip Elder
MPECS Inc.
Microsoft Small Business Specialists
Co-Author: SBS 2008 Blueprint Book
*All Mac on SBS posts will not be written on a Mac until we replace our now missing iMac!
Windows Live Writer
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