Why Managed Print Services (MPS) Companies Add on Managed Services (MSP) Revenue

Many managed print services (MPS) companies have a similar history. The owner founded the company in the 1980s selling photocopy machines, toner, fusers, and service contracts. All that nifty stuff that ruled the roost before most started caring about the financial, moral, and goodwill benefits of being more environmentally conscious or “green.”

But now with 25+ years of business growth in the books, MPS providers have some interesting forks in the road.

Evaluate Whether You're Kicking or Sticking

At the most obvious level, the founder has succession issues to deal with if retirement plans are on the horizon. While many want to work “forever,” most MPS business owners that started their businesses three decades ago are now either in their 50s or 60s.

In some cases, these succession issues are solved by a son or daughter who's being groomed to take over the family business.

Or perhaps there’s a long-time highly-trusted younger 30- or 40-something executive with the managed print company that's a natural to buy out their boss.

And the third scenario we see quite often: the managed print services firm -- with its rich heritage in the photocopier ecosystem -- is acquired by either another managed print company or a more broad-based IT services company, such as a managed services provider (MSP). These roll ups are all about scale, efficiency, profitability, and building out a stronger regional or national footprint.

Grow the Share of Wallet with Managed Services

While for decades, photocopier sales and services companies have dipped their pinky toes in the IT services pool with handling network printing and document imaging solutions, that just doesn't seem to be enough anymore.

More and more, decision makers at small and mid-sized businesses (SMBs) want a single point of contact -- a single throat to choke if you will -- for anything and everything having to do with their IT needs.

Increasingly, this means managed print services companies are taking on much more varied roles including IT help desk, backup and disaster recovery, productivity apps, cloud storage, and security -- just to name a few.

This can be a very good thing for diversifying revenue streams, scaling up the average client lifetime value (big time), and maintaining account control.

The flip side: this different business model -- or “division” of the company -- requires in most cases very different staffing and software.

However if this isn’t approached correctly and managed services aren’t well-integrated into the company and culture of the decades-old MPS company, there can be friction, internal conflict, and confused priorities.

Identify and Resolve Internal Conflicts Between the Managed Print (MPS) and Managed Services (MSP) Business

In the case of a prospect I spoke with a little while back, the company regarded its legacy managed print business -- with roots back to its photocopier dealer origins -- as its cash cow and something that its old-school door-to-door sales team could comfortably sell and its technicians could deliver on.

In contrast, the MPS company was struggling to scale its managed IT services business profitably. In a nutshell, there was not much of a lead generation plan and no real sales funnel. Plus, there was a total mess on the operations side where technician utilization rates constantly hovered in dangerously low territory.

This company wasn’t really even ready for an Inbound marketing and sales strategy to grow its MSP business -- because it hadn’t yet figured out if growing their MSP business was even a major priority or how to scale its technical team.

That company’s CEO has quite a bit of work ahead of him before managed services demand generation can be moved to the front burner. Once this is nailed however, its highly-loyal managed print clients can be a relatively easy, high-margin upsell into managed services -- especially when you use Inbound-centric sales acceleration strategy.

Are you in a leadership role in a decades-old MPS company that’s struggling to reinvent itself with new revenue streams from managed services? If so, how are you managing these internal conflicts? Let us know your thoughts on the MPS vs. MSP debate in the Comments section below.

And if you need to generate high-quality leads and clients from your managed print services website, definitely download a copy of the IT Channel Inbound Marketing Planning Guide.