The truth is, many small business IT consultants choose not to use IT service contracts as part of their business models … and many of them end up working way too hard for way too little money. They find themselves with no real business stability and unable to build solid relationships with steady, high-paying clients.
 
If you want to achieve greater success in the small business world, you need to know how to incorporate the idea of Virtual IT into your IT service contracts. When you provide Virtual IT services to your clients, you need to offer a very wide range of IT services and solutions, that approximate what would be found in a large, enterprise corporate IT department.
 
The following 3 tips can help you learn what you can do to build stable, profitable client relationships and grow your business.

   1.  Know Why Many IT Consulting Companies Get the Virtual IT Concept Wrong. Most IT business owners trying to develop a model for IT service contracts get the idea behind their businesses all wrong and make their jobs much harder than they need to be. These people fall in love with technology, trying to stay ahead of the latest and greatest new platforms instead of keeping an eye out for their small business clients’ best interests.

   2.  Learn from Others’ Virtual IT Mistakes and Omissions. If you fail to understand the definition of Virtual IT and don’t incorporate it into your business model, you will be known as just another clueless geek. Keep in mind that as a true provider of comprehensive IT service contracts, recruiting and retaining small business clients is your #1 priority. Keeping up with the latest technology advances can never get in the way of building relationships and the mission of your computer consulting company. Therefore, don’t be seduced by hardware, operating systems or applications. Instead, fall in love with the business opportunities that go along with solving your clients’ biggest business problems with well-designed IT solutions.

   3.  Know How to Blend Computer Consulting IT Service Contracts and the Idea of Virtual IT. In order to sell profitable IT service contracts to clients, you need to fully understand and use the Virtual IT concept. Virtual IT allows your computer consulting company to function as an extension of your small business clients’ companies. When you follow this concept, your company becomes the outsourced Virtual IT department for your small business clients. You become the Virtual CIO (chief information officer), Virtual CTO (chief technology officer) or Virtual IT manager for all of your small business clients, a relationship solidified further by IT service contracts. You will need to take responsibility for providing or arranging for a complete soup-to-nuts solution that includes important services and benefits like help desk, desktop support, network administration, testing, security, training, procurement and asset management.
 
In this brief article, we talked about 3 tips to help you incorporate the idea of Virtual IT into your model for IT service contracts. Learn more about how you can get great, steady, high-paying clients with well-crafted IT service contracts now at the attached link. 

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Creating a solid IT service contract offering requires a lot of advance planning and the ability to inspire real trust in your prospects, customers, and clients. You need to be aware of which benefits and prices you will offer well before you roll out a strategy and be able to build a very compelling case for why each and every client needs to be on an IT service contract.

The following 4 tips will help you as you build your computer consulting business around service contracts.

1.    Remember That IT Service Contracts are Crucial to Your Company’s Survival … and That One-Shot Deals Are for Amateurs! The value of your entire business is tied up in the recurring revenue you can generate through steady, high-paying clients. Think very carefully about accepting any customers that are not IT service contract clients. Without steady clients, you can’t plan growth or make all the necessary decisions that keep your business moving forward. Successful computer consultants insist on service contracts that bring recurring revenue. Those that don’t use service contracts cannot possibly predict where their companies are going to be in the next few months or years.

2.    Make a Rate Card. A rate card is an integral part of your IT service contract business model. Basically, your rate card is a one-page document that shows typical prices weighed against the prices attached to on-going, long-term contracts. In order to create a strong rate card – and a strong case for your service contracts – you need to come up with at least a half-dozen benefits for why someone would sign an IT service contract with your company instead of paying by the hour. You need to have an established rate card before you try to sell your service contracts.

3.    Consider Travel Distance. If you are currently serving people within a 10-15 minute driving radius of your business location, when you offer service contracts you might need to extend that distance. A lot of your competitors will go 45 minutes or even an hour away, so you have to come up with an economical way to match their efforts. You can charge for travel time to help compensate, or enforce a minimum to protect yourself (preferable) and give more benefits to more long-term clients.

4.    Know When to Offer an IT Service Contract. There are two really great times to offer an IT service contract to a client. The first is right after an emergency service call. Because you’ve just saved the day, you’ll be at a high point. Part of establishing strong relationships with your clients is getting customers to know, like and trust you. After an emergency, your customers will LOVE you because you saved the day. They know you because they just spent many hours with you and they trust you because you delivered on the solution you promised. Another great time to offer an IT service contract is after conducting an IT audit. At this stage, customers will be wondering what to do next. If they agreed to an audit, they are probably looking for someone they can call regularly. And they almost always want someone that will look out for their IT needs and take a genuine long-term interest in helping them implement business solutions that incorporate their technology assets.

In this article, we discussed 4 tips you can use to set up a business based on the concept of an IT service contract, as the basis for building long-term client relationships.

To learn more about how IT service contracts can get you more steady, high-paying clients, sign up for free IT service contract tips now at the attached link.

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Find out if each client is big enough to need a real server, a genuine firewall and backup solution and offsite or online backup.  You also need to figure out if they need to focus on security, power protection and virus protection.  Do they need a professional to give them on-going support for networks and LAN-WAN needs?

The sweet spot clients will need more than just volunteers or friends to handle their IT needs.  They will need to be on maintenance support agreements that help them keep up their productivity and get them more sophisticated solutions.  

Who is Able to Afford Maintenance Support Agreements?

When examining ideal clients, you will find small businesses that will have a budget that allows them to spend $1,000-$2,000 on IT support.  This means you will be there a few half days per month and will respond to phone calls for emergencies and remote support.

What Does a Sweet Spot Client that Can Afford Your Maintenance Support Agreements Resemble?

This type of client will not need very generic support or support for a P2P network.  They need to be big enough for downtime and data loss to be really expensive.  They will need your maintenance support agreements for peace of mind.  

Blogged By:  Computer Consulting 101 Professional Kit

You need to establish an IT services agreement about having a single point of contact, software licensing and confidentiality clauses.  But you need to explain what you normally charge and in return, the customer will be pre-paying a set number of hours that will give them a discount.  Then you can set up your accounting and generate a renewal notice when time is almost used.

The big advantage is that you get cash up-front that can help with your profits and you will not worry about getting stuck.  The disadvantage is that you don’t get the same level of recurring revenue as you get with support contracts.  This is because you are selling a fixed-price service that has a definite beginning and end.  

Valuable IT Services

You need to be sure you set up fixed-price clients on a proactive plan.  This means you need to be in touch with them regularly and take care of their security needs on an on-going basis.  You have to be sure that your backup is running right and that things are being documented and set up so you can fix them in order of priority.

The pre-paid block of time should not allow you to get into a situation where you are doing one-shot deals.  Make sure you are setting up IT services for long-term relationships.

Blogged By: Computer Consulting Kit

IT Service Agreements:  Plan Ahead

You need to plan ahead with IT service agreements so your customers will trust you.  What benefits and prices will you offer to customers?  Set a rate card and determine your terms so you can please current customers and create a strong case for why future clients should sign IT service agreements.  

IT Service Agreements:  The Rate Card

A rate card is simply a one-page document that displays typical prices vs. service agreement prices.  This card acts as your marketing summary for benefits.  You should spend time coming up with a list of half a dozen really strong benefits for why someone should want to sign IT service agreements instead of paying your hourly rate.  

The Bottom Line About IT Service Agreements

Plotting out the terms and conditions of your business agreements will help you know what you are doing when you are on sales calls.  If you don’t have clearly defined terms as part of IT service agreements, you will be announcing to the world that you don’t quite know what you are doing.

Added By:  Computer Consulting Kit

The Computer Consulting Kit offers practical advice on one of the most important elements of a successful IT consulting business – service contracts.  Bill Morgan started his consulting business, Nerds on Wheels in San Diego, California and has used the templates provided by the Computer Consulting Kit to organize a system of service agreements for clients and clarify his business plan.

The strategic marketing techniques presented by the Computer Consulting Kit also helped Bill get his name out there and attract great clients.

“I implemented a remote maintenance and monitoring package. I developed a process for remote monitoring of customer computers with Hyblue. The process also includes once-a-month maintenance on the client’s computers and a status report.

The status report is written in such a manner that a businessperson can understand it. I then developed a marketing letter for the remote maintenance and monitoring package and started weekly mailings. The concept of service agreements introduced by the Computer Consulting Kit was the main item that helped me accomplish this project. Also the rate sheet is great for showing the clients the benefit of service agreements.”

The Computer Consulting Kit:  Benefits and the Bottom Line

The Computer Consulting Kit has many templates and pieces of advice that can help organize any computer consulting business.  It has helped computer consultants like Bill Morgan improve revenue and provide the best solutions to clients.  Join the leagues of computer consultants benefiting from the Computer Consulting Kit including free tips and online resources by visiting the attached link.

Added By:  Joshua Feinberg

I recommend this very simple, back-of-the-napkin calculation:

• What was the client’s net income or bottom line last year?
• Divide that figure by roughly 250 business days and 8 hours a day.

Following this calculation, if your client had a net income of $1,000,000 last year, your client loses $500 ($1,000,000 divided by 250 business days divided by 8 hours/day) in net income for every business hour of downtime.

If your client loses $4,000 of net income every day that their network is down, is it really all that difficult for your client to justify a small investment in monthly proactive network maintenance?  

Costs vs Benefits of Proactive Network Maintenance
Properly planned, designed and installed small business networks are generally very reliable. However, when pitching a client on the benefits of proactive network maintenance, it’s crucial that you steer the conversation in terms of cost/benefit analysis.

• First, quantify the concrete benefits you’ll provide to your client.

• Next, present a monthly recurring cost (ah… recurring revenue stream!) based on your estimated labor billing and required service margins. Perhaps, you’ll offer a bundle of services that can be profitably delivered for $250 to $500/month based on a 2-year commitment.

• The real deal clincher comes when you begin to discuss the cost of doing nothing to prevent downtime. Your proposed proactive maintenance plan may cost $3,000 to $6,000 per year. However, if you can prevent just two days a year of downtime ($8,000 from the above example) the price is easily made up for.

• If they’re still skeptical and perhaps don’t believe your downtime cost scenario, take a look at their IT service invoices for the past 12 to 18 months. How many times do you see phrases like, “Server down emergency”?

Bottom Line on Network Maintenance
Proactive network maintenance makes sense for the client and for you.  Clients who pay for  proactive network maintenance inevitably save money in the course of the first year.  By providing network maintenance on a proactive basis, you save yourself major troubleshooting headaches and you guarantee yourself a revenue stream.

In this article, you’ve been introduced to Network Maintenance. To learn more about how you can improve your knowledge about Network Maintenance, just click here now to get access to a free one-hour audio training program on 5 Easy Ways to Grow Your Computer Consulting Business. 

If you don’t provide phone support at all, what is your clients’ comparative alternative? They would end up having to call an independent phone support hotline. 

• These services typically charge $2.99 or $3.99 per minute

• For a 15 minute phone support call that adds up to $45.00 to $60.00

• The phone support is not even half as good:

• You’re definitely going to be much more skilled than the typical person phone support hotline person
• You know the account
• You know and understand the client’s needs
• You know all their bizarre configurations, workarounds, tweaks, and business issues
• You have a 360-degree bird’s eye view that allows you to offer targeted and accurate phone support

Now, your typical hourly rate should be in the $75.00 to $125.00 range.  For phone support we suggest you use a 15 minute minimum.  This makes for easy billing and it dissuades continuous, small, inconsequential phone support requests. This means that your phone support would cost anywhere from $19.00 to $31.00.

When you compare both the cost and the value of the phone support you provide, it’s easy to justify charging for phone support.  

Bottom Line on Phone Support
Don’t think about your phone support charges in terms of the $20 or so dollars you are billing.  Think about your phone support in terms of how much value the client is getting and the fact that comparative alternatives are more expensive in the long run. If you encounter resistance when charging for phone support, run this little scenario by your client.  You’ll be surprised by how quickly they buy-into your phone support pricing.  

In this article, you’ve been introduced to Phone Support. To learn more about how you can improve your knowledge about Phone Support, just click here now to get access to a free one-hour audio training program on 5 Easy Ways to Grow Your Computer Consulting Business. 

When you are billing on a hourly rate, the hours you spend providing phone support need to be charged as well as on-site time.  Let’s face it, with phone support you’re going to be contacted by phone, on your cell phone, by pages, by email etc… You’re going to be doing phone support on a remote basis – and you can expect to do a lot of it.  

There is a great deal of time involved in phone support and if you don’t get paid for it, your hourly rate is $0.00.  Profitable businesses don’t charge $0.00 for their services. If you think you can justify giving away phone support "only to good clients" or "only just this once" you are fooling yourself.  

When you give away phone support you also take away your clients’ incentive to call you for an on-site visit.  Why would they pay you $100 on-site when they can call you up, get a few instructions, and then not have to pay anything?  Are these clients gong to remain good clients?  No, they’ll start to abuse the free phone support – it’s human nature to want to save money.

Bottom Line on Phone Support
Don’t give your phone support away for free!  The information you provide over the phone is just as valuable as the support you provide on-site.  You need to understand that giving away phone support is not going to boost your business and it’s not going to make good clients more loyal.  Your "good" clients will start to abuse it and you will hemorrhage money if you provide free phone support.

In this article, you’ve been introduced to Phone Support. To learn more about how you can improve your knowledge about Phone Support, just click here now to get access to a free one-hour audio training program on 5 Easy Ways to Grow Your Computer Consulting Business.

If you offer a fixed price for ongoing maintenance you would typically have sold them a network already and now you are taking care of it for x number of dollars per month.  Your first instinct would be to also say you are offering this fixed price "subject to these restrictions."  But, if you have just one paragraph let alone pages of "subject to" restrictions, this is a major turn off for any client.

So how do you protect yourself with fixed prices? 

You create a fixed price agreement that has a very tight scope to begin with.  Rather than provide blanket coverage and then slowly take the blanket away with restrictions; give them only as much blanket as you have accounted for in your fixed price.  The psychology changes:  You are not taking away, now you are giving.  

The other issue you must be concerned with when using fixed price agreements, is to maintain control of all moves, adds, and changes.  You don’t want the self pronounced computer guru at the company to start mucking around with your system.  If they do, your fixed price will include the time it takes for you set things right again.  To avoid this, you need to train the internal guru so he/she knows her limitations and knows when to call you.  

Bottom Line on Fixed Prices
Fixed price maintenance contracts can be done.  Your challenge when using them, is to make sure you have covered off as many contingencies as you can up front.  This way you don’t end up having to set up restrictions later on or risk losing your shirt.  Fixed price contracts are an attractive selling feature but the onus is on you to do everything you can to make sure the time you are spending is adequately compensated.  

In this article, you’ve been introduced to Fixed Prices. To learn more about how you can improve your knowledge about Fixed Prices, just click here now to get access to a free one-hour audio training program on 5 Easy Ways to Grow Your Computer Consulting Business.