At least a half-dozen times over the past year, John Ahlberg’s company has acquired new customers who were worn out from working with MSP franchisees.
It’s almost the same story each time, explained the president of Waident Technology Solutions, a Chicago-based MSP. “They initially chose a franchise because it was part of a bigger company, and they thought that would mean better services. But within six months, they found themselves having to get used to new people who didn’t know their systems.”
Initially, there are good reasons why small and midsized businesses (SMBs) choose to work with a big-brand company. Franchisees have power behind them with larger staff and name recognition. They have easy access to operational support, specialized training programs, co-op advertising and marketing dollars, and other such support.
But over time, some tend to realize that they prefer a more personalized, flexible approach. That’s where independent MSPs say they have the edge.
A Hybrid Approach: How The 20 Bridges the Gap
Tim Conkle believes that going it alone isn’t always the best option. In fact, the CEO of The 20 has built a successful business model from that strategy.
The 20 is a co-op offering independent MSPs access to shared services, like an IT help desk, while allowing them to maintain operational control. For a fee, The 20 delivers resources directly to MSPs’ customers while local MSPs still handle tasks like on-site tickets. This hybrid model empowers independents to compete more effectively with franchisees in service delivery and efficiency.
“If a franchisee decides to leave the franchise, they have to relinquish all of their clients, [after] the MSP spent a lot of time building the business,” Conkle emphasized. “And now, he can’t sell the business to anybody but another franchisee.”
In contrast, The 20 allows MSPs to retain control of their business operations while leveraging the resources of a larger organization.
3 Major Advantages Independent MSPs Can Flaunt
When compared with franchisees, independent MSPs shared that they win out on a few factors. These have to do with the fact that they can make decisions that don’t always align with a larger organization’s overall goals and structure.
Nate Sheen
Personalization, flexibility, and value can go a long way toward helping MSPs succeed. Here’s a closer look at those advantages:
No. 1 Flexibility
Independent MSPs are nimbler than franchisees that may have to follow specific rules of the franchisor, according to Nate Sheen, president of Ohio-based MSP Astoria. “We can jump into that meeting today or get that specific product or hardware for you that maybe the bigger MSP franchises won’t allow you to do.” That flexibility also extends to fewer restrictions on spending, within reason, instead of having to follow specific rules about how and what to spend.
For MSPs focused on community, that may mean spending on sponsorships, supporting specific nonprofits, or having seats on boards. While spending that money may not directly increase revenue, it’s key to the organization’s values and/or its ties to the community.
No. 2 Value, Not Dollars
Often, franchisees are laser-focused on profit, driven by the philosophy of the franchisor itself. That can translate into customers paying a less-experienced tech a higher rate, or having costly equipment installed versus a less-expensive alternative that’s just as good. “Trying to beat a competitor by price has never really worked for us,” Sheen admitted. “They’re probably going to come back to us at some point. I’d rather work with clients who are here for the relationship and know we’re not going to spend every dollar they have.”
John Ahlberg
No. 3 Personalized Service
Independent MSPs often have the luxury of being able to spend more time with each customer, whether it’s a new or existing client, per Ahlberg. It’s easier for an independent MSP to provide consistent, personalized service with the same team who truly know the customer, he added. “When franchisees bring on a new client, they focus on them well for the first six months, but then tend to start laying off resources because they’re chasing the next one,” Ahlberg said.
It’s also easier to tailor services to individual clients or particular verticals, instead of having to adhere to franchisor policies, noted Sheen. “Our customers know that the guy they talked to on the phone is also the guy who will probably show up on site next week to install the computer. That’s been a winning strategy for us.”
Find the Right Fit
Clearly, independent MSPs can thrive. Waident, for example, has been in business for 20 years, now boasting a team of 30 working out of three offices.
Ahlberg credits its success, in part, to personalized service, flexibility, and value. These key advantages set independent MSPs apart from larger, franchised providers. “In the end, it’s about listening to customers,” he shared.
For SMBs weighing their options, the choice between a franchise and an independent MSP often comes down to what matters most: the ability to adapt, personalize, and provide the consistent service they need to succeed.
Featured image: iStock
