Join Carrie Simpson and Wise-Sync CEO (and former MSP owner) Paul MacNeill as they talk about shifting to efficient systems for increased profitability.  In this episode, he shares why a streamlined payment processing system is necessary for an MSP to thrive and have better cash flow.

Hassle-Free Accounting

A common problem faced by MSPs is inefficient payment processing. Having a ton of receivables every month means spending a lot of time chasing checks, thus reducing profitability. Instead of spending time working on improving the business, more owner time is used for accounting. Automating client payments make things easy for a business since everything is directly debited from a bank account. Spending less time settling accounts receivable means a more profitable MSP.  

 The Price is Right

When you're solving a huge problem, a business should charge what the market will bear. Paul explains that the whole idea of going up even that 25 percent increase of net revenues will have a significant impact to your bottom line. Getting more clients will have a fractional rise in profitability, but dropping that extra 25 percent down to the bottom line could be a 300 percent increase profit. Just making the shift means the business can get benefits and outcomes from a return on investment on sales development strategy. Now, it is crucial to raise prices to a level that is sustainable to the business. The price will determine the direction a business will go – either hit the jackpot or go bankrupt. Paul says that the price of a product is based on its value because it is far greater than the cost associated with it.  

About Paul McNeill:

In 2012 when founder Paul McNeill exited from his MSP, he maintains that having no receivables allowed him to command a significantly higher multiplier than MSP businesses were receiving at the time.  Wise-Sync was founded while Paul owned his MSP, and when the MSP sold, Paul was able to pivot into building their SaaS business full time.

The goal was and still is to be the most robust integration to sync accounting data from ConnectWise or Datto Autotask to the Cloud. While running an MSP, Virage IT, McNeill and his team realized they needed a better way of getting paid and reducing their 48 days in receivables. It was during this state that they had experienced a “Eureka!” moment and decided to change their focus to processing more automatic payments and accepting credit cards - they saw their days remarkably drop from 48 to just two days, drastically improving cash flow. Wise-Pay has been a defining platform for business, not just in terms of cash flow but also by simplifying payment processes, which could be the same for you and your MSP.

Outline of the Episode:

[00:26] Starter to Wise-Sync and what services the company provides

[03:17] Inefficient and archaic banking system that affects payments and cash flow

[07:35] Simple economic principle of “charge what the market will bear”

[10:16] How traction helps to get clarity in what to do to make the shift

[14:07] Value is still far greater than the cost associated with it

[22:22] Suggestions for clients struggling to understand opportunity costs

[28:37] The idea of telemarketing and automation to allow more touchpoints through outbound

[38:47] Awareness of the environment to articulate an exit strategy

[45:02] Wrap up of the episode

Resources:

Website: https://www.wise-sync.com/

LinkedIn: https://www.linkedin.com/in/paulmacneill/

Connect with Carrie!

Website: https://www.managedsalespros.com/