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Sources of Revenue for Australian MSPs

Writer's picture: Nick BeaugeardNick Beaugeard

Managed Service Providers (MSPs) in Australia have several key revenue streams, reflecting the evolving needs of businesses and the growing complexity of IT environments. Whilst many these provide the bedrock of a MSP business, there is little chance to compete on these somewhat commoditised services. Read on to see how you can compete and develop new sources of revenue...


1. Recurring Managed Services

Recurring managed services are a significant and growing source of revenue for Australian MSPs. These services include ongoing IT support, network management, and cybersecurity monitoring. In 2024, it is expected that 39% of MSP revenue will come from recurring managed services, up from 29% in 2023. This growth is driven by businesses increasingly outsourcing their IT needs to MSPs to focus on their core activities and mitigate costs associated with maintaining in-house IT teams. It also comes from MSPs moving from break-fix to a managed model.

However with the advent of cloud computing solutions, issues such as downtime, poor performance and more are diminishing, leaving customers mainly happy and offering little churn to enable a MSP to differentiate and provide a compelling reason to switch on this offering alone.


2. Security Services

Cybersecurity is a critical area where MSPs add substantial value. Australian businesses are increasingly turning to MSPs for security solutions due to the high cost, complexity, and resource demands of managing cybersecurity in-house. Key security services offered by MSPs include network security, security awareness training, and security operations centres (SOCs). These services are among the most successful in attracting new customers and are essential for addressing the growing threat landscape​ according to IT Brief Australia​.


3. Cloud Services and Infrastructure Management

With the widespread adoption of cloud computing, many MSPs generate revenue through cloud services, including cloud migration, management, and optimisation. Cloud marketplaces such as AWS and Azure are also becoming crucial tools for MSPs, providing platforms to offer and manage a variety of IT and security solutions. Nearly half of the MSPs recently surveyed by IT Brief Australia already use cloud marketplaces, indicating their importance in the current MSP business model​​.


4. Consulting and Professional Services

Consulting services, including IT strategy development, compliance consulting, and digital transformation advice, are valuable revenue streams. MSPs offer their expertise to help clients navigate complex regulatory environments and adopt new technologies efficiently. These services are essential for businesses looking to stay competitive and compliant with industry standards​ according to IT Brief Australia​ and LeftLeads​. This is an area where a partnership with World of Workflows can really help. By using this tool, available in the Azure Marketplace, MSPs can quickly show the value of business process automation and platform integration and show how they can be a trusted partner in the new world of Digital Transformation.


5. AI and Automation Solutions

AI and automation are becoming increasingly important in the MSP landscape. Many MSPs are investing in AI-powered tools to enhance their service offerings, including automated threat detection and response systems. The ability to leverage AI to improve operational efficiency and deliver innovative solutions to clients is a growing revenue stream​ according to IT Brief Australia​. A partnership with World of Workflows allows a MSP to take this ability even further, helping their clients integrate AI into their business processes, streamlining their operations and growing their business.


6. Vendor Partnerships and Reselling

Vendor partnerships play a significant role in the MSP business model. By partnering with technology vendors like Microsoft, Citrix, and us, MSPs can resell software and hardware solutions, often bundled with their own services. These partnerships allow MSPs to offer comprehensive solutions that meet a wide range of client needs, driving additional revenue through reselling and value-added services​ according to LeftLeads​.


7. Training and Support Services

Providing training and ongoing support is another key revenue stream. MSPs offer training programs to help clients maximise the use of their IT investments, ensuring they are well-equipped to handle their IT infrastructure effectively. Support services, including help desk and technical support, are crucial for maintaining client satisfaction and generating recurring revenue​ according to LeftLeads.


By focusing on these diverse revenue streams, Australian MSPs can enhance their service offerings, meet the evolving needs of their clients, and drive sustainable business growth.


Adapting to industry trends and continuously expanding their capabilities will be essential for MSPs to maintain their competitive edge and achieve long-term success.


Want to enhance your MSP Offerings? Sign up as a World of Workflows Partner today!

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