3 Ways To Increase Your Monthly Recurring Revenue

Increasing Recurring Revenue

Gary Pica knows a thing or two about managing an MSP business. Before he was president of TruMethods, Pica grew a managed service provider business from zero recurring revenue to more than $500,000 a month before selling the company to mindShift Technologies (which waslater acquired by Best Buy).

Today, TruMethods counts more than 450 members to subscribe to its coaching program to help MSPs be more successful. Pica shared some of his tips during a ComdexVirtual session for those struggling to win more recurring revenue.

"A lot of people think it's like 'Field of Dreams.' Build it and they will come. But, getting people to pay you every month is not easy," Pica said.

Here's a look at what you should be doing to increase your recurring revenue stream

Dedicate Resources

To successfully increase managed services, you need the right processes and resources in place, according to Pica. It's a difficult transition for sales staff to just add managed services on top of selling products and project work, he said.

"I haven't seen that approach be successful. It's better to take one of those sales people and dedicate them and motivate them and pay them to solely focus on adding monthly recurring revenue," Pica said.

Know Your Sales Math

MSPs should set a concrete target goal of how much additional recurring revenue they want to add, which then makes it easier to plan accordingly, Pica said, adding that $24,000 a year (or $2,000 per month) of new recurring revenue should be a minimal goal.

"Do you know what kind of pipeline you need to achieve that goal? Do you know how many appointments you need to go on? If the answer is no, that's not a goal; it's a hope or a dream. A goal is accountable and you know the steps to get there," Pica said.

TruMethods has a sales goal calculator to help understand those steps, Pica said.