IT and Business Insights for SMB Solution Providers

Stop Thinking in Terms of Margin!!!

New video posted: SOP: Stop Thinking in Terms of Margin.

I'm very tired of hearing people say that they are forced to sell things for a low margin.

- Spam filtering is low margin
- Office 365 is low margin
- Anti-Virus is low margin
- Storage is low margin
- Voicemail is low margin
. . .  etc.

Important safety tip: It's only low margin if you sell it at a low margin!

Stop doing that.

How? That's easy: Bundles!

Bundle together all the technology your clients need - including services - and sell the bundle for a good price. This is easier to do every day. In fact, it's exactly the strategy we talk about at the SMB Roadshow events.

Too many people are still thinking that they need to buy "stuff" from distributors, mark is up 3-7%, and sell it to clients. Why do they think that? Because that's how they got started. Or that's what they've been doing for five years (ten years, twenty years, etc.).

Just because you did it last year doesn't mean you have to do it next year.

The road that got you here won't get you anywhere else!

One of the most powerful mind shifts you can have is to realize that the price you pay is unrelated to the price you charge. These two have never been related to one another. Don't believe me? Go to an Audi dealership and buy a pair of windshield wiper blades. Now go to a VW dealership. Exact same blades. Made to the exact same specifications. Same packaging. Made in the same factory. Audi price is 3x the VW price.

Price is determined entirely by the intersection of what you charge and clients who are willing to pay it.

Bundles make it so much easier to show clients the value of your total services. Instead of literally nickle and diming clients with ten different services, throw them all into a bundle with labor. You have simplified technology for the client and made their life easier.

Watch the video. Feedback welcome.


About the Author

Karl W. Palachuk, is a technology consultant, author, speaker, trainer, and coach. He is the author of fifteen books. He has built several successful businesses, including two managed services companies. His books include Managed Services in a Month and The Network Documentation Workbook. Karl is a frequent trainer and speaker in the SMB Community. His popular blog can be found at He has more than twenty years experience as an I.T. professional and serves on advisory panels for several hardware and software companies.

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