How To Sell IT In Tough Times

MANAGED SERVICES
Taking services a step further, many VARs find that it often makes economic sense for customers if the solution provider becomes their outsourced IT department. Say hello to managed services. By remotely managing and monitoring your customers' PCs, networks, storage, printers and more, you provide yourself with a recurring revenue stream and end users with a fixed IT budget. Everybody wins.

Greg Starr, COO of IT Works, a Houston-based solution provider, said his managed services business is doing so well it's hard for him to even admit times are tough.

"Are the sizes of projects smaller? We're seeing some of that. But overall we're seeing a lot coming through," he said. Longtime VARs have survived enough economic rollercoaster rides to know that quick turns are tough on everyone involved. The ability to strap in and hang on tightly by quickly adjusting to economic slides is all part of maintaining a successful business.

For IT Works, having a managed services practice gets Starr's company more ingrained with the customer, which helps insulate both parties against a depressed economy. Managed services brings IT Works a steady revenue base, while also helping customers reduce their own IT costs, he said.

"If you're busy with managed services, you're not waiting for the phone to ring in that environment," he said.

DIVERSIFICATION
Wall Street fortunes have been made through keeping diverse stock portfolios, and the same can be said for solution providers. Although it's true that many VARs find success with niche markets or technologies, that model can be more risky over the long term, especially if you're new to the game. Sometimes the key to selling in a tough economy is to keep all your options open.

Global Technology Resources Inc., a Denver-based solution provider, has grown to $180 million in part because it serves six or seven different markets instead of two or three, said Glenn Smith, executive vice president of operations and co-founder of GTRI.

If one vertical market isn't buying, there's a good chance one of the others is, Smith said. The cyclical nature of many markets allows the solution provider to get through times that prove tougher for competitors.

"We've been able to diversify across so many different market segments," he said. For example, a new customer base for the company is oil and gas companies. "Our eyes have opened in new places, not only where to take wireless, but other practices as well."

Another factor for success that solution providers should take advantage of are policy changes. For example, the federal government's recent approval of wireless connectivity should lead to a bounty of opportunities, said Charlie Franco, whose company Anyware Network Solutions Inc., a wireless specialist, was recently purchased in August by GTRI.

With the new approval, the wireless opportunity "will be huge," Franco said.

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