Over the past 20 years, managed service providers have weathered recessions, tariffs, global supply chain breakdowns, and a pandemic. Each crisis tested the MSP model, yet the industry has grown into a $595 billion powerhouse with more than 40,000 IT providers and thousands of major vendors.
According to technology leaders that ChannelPro spoke with, the IT channel is an exceptional source of strength for the U.S. economy. Regardless of the political battles raging in Washington, D.C., MSPs’ adaptability and ingenuity helps small businesses grow, even when times are tough.
Below, several leading channel voices shared how MSPs can stay resilient when macroeconomic forces like tariffs threaten their margins and operations.
Not the First (or Last) Trade War
Although the current administration has a flair for the dramatic, the current situation isn’t unique.
- In 1987, President Ronald Reagan imposed 100% tariffs on $300 million worth of Japanese imports, targeting certain computers, power tools, and televisions. That was in retaliation for Japan’s failure to comply with a 1986 semiconductor trade agreement.
- The first Trump administration implemented several rounds of tariffs in 2018 on China under Section 301 of the Trade Act of 1974. Those taxes were imposed on a wide range of Chinese imports, including components for servers, PCs, and networking gear. It was a response to what the administration deemed unfair trade practices and intellectual property theft.
However, the latest round of tariffs has been wide-reaching. Beginning in 2025, new taxes apply to goods from 90 countries. That includes a 145% tariff on all Chinese goods — which subsequently paused for additional negotiations — and a 25% general tariff on Canadian and Mexican goods.
Major hardware manufacturers lean on both Mexico and China in particular. Dell builds desktops and servers at its FSJ assembly plant. Cisco runs a supply-chain and engineering center in Guadalajara, and HPE operates a customer engagement center in Mexico City.
The U.S. also uses a vast array of made-in-China computer hardware — everything from finished systems to components like motherboards, graphics cards, memory modules, and storage drives.
Although the tariff percentages are significantly higher now, the net result is the same. Manufactured goods arriving from overseas are more expensive. And some experts have said it will trigger a ripple of price increases, project delays, and staff cuts.
Reaction from Across the Industry
Among the most common reactions to the tariffs: calm acceptance. For many MSPs and vendors, the news reinforced what they already expected, prompting caution but not alarm.
Rick Stern
“I think we all have relatively short memories,” said Rick Stern, senior director of platform for Sherweb. “This isn’t the first time this has happened. We had the Covid-19 pandemic, high interest rates, and the Ukraine war, which dragged the global economy down for a bit. This is just another blip. MSPs will have to think critically and strategically about how they want to get through it.”
CloudRadial CEO Jeff Farris described the worst-case scenario. “Prices will go up on everything, leading to a new round of inflation as consumers and wages react to the new prices. As businesses wait to see how prices settle out, they will delay decision making and try to stop existing projects. Businesses will need to cut payroll and other costs so their customers don’t fully bear the higher prices, and they potentially deal with lower revenues.”
Don Burt, partner manager with 12:34 MicroTechnologies, expressed exasperation at man-made disruptions like tariffs. “Politics is messy enough and should not enter into business,” Burt said at ChannelPro LIVE: New Jersey.
Rory V. Sanchez
Rory Sanchez, CEO of Florida-based Forthright Technology Partners, highlighted the tit-for-tat nature of trade disputes. “Most Central and South American countries tariffed the crap out of U.S.-made goods, and our stuff sat in customs for weeks before being let in.”
In Sanchez’s view, the administration’s goal is to force negotiations that will result in free trade across the board. If achieved, that would be a major win for the industry.
“The administration’s thinking is this: We could call every country and politely ask them to eliminate tariffs on U.S. goods. Or we could announce big tariffs on everyone who has been putting big tariffs on us. Then sit down with everyone who calls and negotiate reasonable terms,” he shared.
In the interim, while there is plenty of angst relative to the global macro economy, it’s best for those in the channel to not let it distract them from their overall mission, advised Bob VanKirk, CEO of SonicWall. “I’m doing my best to ensure the team is focused. We’re going to stick to our primary objective, which is providing the best solutions, the best services to and through our partners. We will definitely keep a pulse on what’s what’s going on, but that, I think, will will enable us to weather this storm.”
MSPs are Demonstrating Resilience
Will Ominsky
MSPs are beginning to see some impact from the tariffs when it comes to acquiring hardware, said Nerdio Vice President of MSP Sales Will Ominsky. “Quoting, for example, is becoming more difficult — even signed orders are having prices changed. The largest impact is the uncertainty MSPs are facing when trying to acquire hardware, particularly a large number of endpoints or servers.”
MSPs are also retooling their sales pitches and procurement models, Ominsky added. “We are seeing some MSPs gravitate to cloud-based solutions in their sales processes to combat uncertainty with hardware pricing fluctuations and possible supply chain issues.”
Some MSPs are considering raising their rates now, before tariffs fully take effect. “I don’t know if there’s ever a great time [to raise rates],” shared Greg Saenz, Barracuda Networks vice president of channel for the Americas. “It boils down to, are you able to provide valuable services? Be direct and ask if you are offering enough value to justify the price point.”
Jon Murchison
Meanwhile, recessions also can offer opportunities, according to Jon Murchison, founder and CEO of Blackpoint Cyber. “Focus on automation, Microsoft certifications, and fundamentals. Most successful business owners grow during downturns. Tariffs haven’t hit MSP hardware that hard yet. Never waste a good crisis. Wake up. Focus on repeatability. Don’t geek out over every new tool. Evaluate based on value,” he said.
Blackpoint Cyber Chief Client Officer Mike Estep echoed that thought. “The MSPs that I talk to are calm. Government-focused ones might be worried, but most are in SMB. They’re figuring out how to run the business from an iPad. That’s the mindset: differentiate, simplify, adapt.”
Jim Lippie, chief product officer at Kaseya, provided similar feedback. “MSPs have always done well even in down years because businesses view them as a utility. They might delay upgrades, but they don’t drop core services. In some cases, they outsource more. That’s an opportunity.”
Chris Collins, owner and senior technical consultant at the NJ-based MSP CBC Technovations, summed up his thoughts on business growth in uncertain times. “Don’t rely on what you’ve relied on in the past. Be willing to stretch out and try new things: peer groups, business-to-business intelligence, whatever it takes. You have to get out there and hustle.”
Financial Resilience Tips
- Protect your margins. Revisit rates regularly and build in small cushions for cost spikes.
- Build flexible contracts. Include clauses for hardware delays or cost shifts, and offer multi-option or month-to-month plans.
- Cut waste. Trim unused subscriptions, renegotiate vendor contracts, and solve more issues remotely.
Operational Efficiency Recommendations
- Stay agile. Stock critical hardware and lock in prices. Maintain backup plans for suppliers, services, and contracts so you can pivot quickly.
- Optimize existing tools. Show clients how to get more value from current systems before recommending new purchases.
- Stay proactive. Inform clients before they ask about cost spikes and inventory issues.
Client Engagement Best Practices
- Focus on recession-proof services. Lead with services that clients won’t cut: cybersecurity, compliance, and backups.
- Deepen client trust. Act as a trusted advisor. Propose cost-saving moves and demonstrate that you understand their challenges.
- Be transparent. Tell clients early about delays or price changes, and explain why.
- Focus on outcomes, not features. Tie every technology investment and project to clear ROI and risk mitigation.
- Keep improving. Refine processes, invest in team training, and continuously seek better ways to deliver value.
Featured image: iStock
