Over the last 25+ years I have participated in the Imaging Channel or what was once called the Copier Business. Over the last few years, I have been focused on helping in the transitioning of a legacy copier company, into a fully Managed IT Services and Managed Security Services Company. The transition for that company is complete and what I learned, is many articles. This article I will discuss the under-utilized program of leasing within the IT services sector. The Imaging Channel understands and has capitalized on leasing for years. The IT Services Channel must adopt a leasing strategy to deliver Managed Services to be profitable and scalable. Why are they taking so long to figure this out is the question?
The very essence of the cloud and its benefits was to allow organizations to eliminate the need for large cash expenditures. When a Managed Service Provider does not offer an option for leasing or renting Hardware, they are missing out on many opportunities and will eventually lose customers. The facts are – customers within the SMB market place are moving more and more to a pay as you go model. This is great news for the Managed Service Provider who understands the value of the reoccurring revenue model, and understands how to deliver both hardware and services through that reoccurring revenue model. The question is whose model will it be delivered through? Yours or your competitor. A competitor who understands and can articulate the benefits and value of a monthly cost over capital out-lay. While at ImageQuest our percentage of customers who included Hardware in a monthly reoccurring model was over 85%. So I guess you could say, without a monthly hardware acquisition program, we would have 85% less customers. This fact should motivate the IT service provider, if it doesn’t, your competitors will thank you.