Contingent labour can be costly—add in outsourcing, and companies can accumulate huge bills. As an MSP, you need to compete, not only in terms of service but costs too. With Brexit and skill shortages having driven up labour costs, it’s vital you keep your managed service affordable to attain AND retain clients.

It’s no longer just a case of offering a service worth paying for. You must also ensure your clients can financially sustain it long-term. By maintaining a top-quality service at a lower cost, you can outdo your competition and secure strong, long-term business relationships.

However, how can you lower your service costs whilst maintaining profitability?

The answer is VMS. Manual workflows mean high operational costs, which are, of course, recuperated from clients. Such workflows simply waste both you and your clients’ money.

With the right VMS, you can cut out costly admin labour, software clusters and human error. The cost of the technology is easily offset (and then some) by the savings it yields, which are passed on to clients.

According to Theo Vadpey (Qualitative Research Assistant—Staffing Industry Analytics), “Firms that had less than five percent of their revenue flowing through a VMS were less continuously profitable than others”. This shows that VMS is a must to compete financially in the current MSP industry landscape.

So how exactly does it work in practice?

Manual Admin → Automation

With the right VMS system, you need only enter data once. You can automatically share vital details with your suppliers, clients, and workers on a cloud-based system. This reduces the need for large admin teams on your payroll (as well as the human error and costly damage control they bring).

Not only this, but it saves huge amounts of time. It enables more efficient communication with suppliers, getting the right candidate to your clients quicker.

Siloed Software Systems → All-in-One Platform

Using multiple platforms and software within your workflow means reduced visibility. This can create blind spots for spend to go missing in, thus increasing your clients’ bills and eroding their trust in you.

With a cloud-based all-in-one platform, however, you can keep track of all costs at all stages. With high-volume cloud-based storage, you can maintain all POs, timesheets, and invoices in one place.

This means that when disputes arise, you can quickly backtrack documents with complete transparency, preventing unnecessary overspend.

Costly License Software → Pay as You Go

With the right VMS, you can pay for your exact volume usage (e.g., per active worker) and nothing more. In reducing budget leakage on fixed service prices, you are better positioned to lower costs for your clients.

Whereas previous licence software offered little flexibility with long-term contracts, simple monthly payments can reflect your exact workflow needs as they change: less CAPEX spend for you and lower costs for your clients.

In conclusion…

VMS can introduce a more time and cost-efficient workflow, empowering you to elevate your service and lower client fees. With automation, an all-in-one platform, and flexible payments, you can offer higher quality for less. Long-term, this can see massive profitability, as a top service on minimum spend can see client acquisition multiply.

Get in touch to see how ENGAGE can help accelerate your MSP growth.