It’s no secret that hardware margins have dwindled significantly over the past several years, causing integrators to take a long hard look at the business, their processes, and how they can boost recurring monthly revenue (RMR). And thanks to new and emerging technologies, products now exist that offer long-term relief to this conundrum and offset low-markup equipment margins that seem all too commonplace.
The time is now to move away from hardware-centric, time and material billing and the accompanying break-fix mentality to proactive, high-end services that your customers love and will keep them ‘sticky’ for years to come.
For security integrators key focus areas are converting video surveillance and access control into recurring revenue businesses via hosted and managed/monitored system architectures. There is no one solution here—pricing, packaging, sales and service issues vary based on size of system and size and financial resources of the system integrator.
Beyond-security categories like remote monitoring and management (RMM) of customer’s networks are another way integrators are looking at adding monthly recurring revenue. Customers pay monthly fees to keep their networks up and running 24/7. Integrators, thanks to this need breed of monitoring automation equipment, can stay abreast of any pending maintenance issues – all from their office. Integrators can monitor network health and respond as appropriate, for example, rebooting broadband modems, or replacing aging projector bulbs before the customer even becomes aware of any issues. Better yet, because many of these services can be performed remotely, the costly roll of a truck can be avoided. So in addition to more RMR, there’s less money spent for technicians to travel out to the field to perform maintenance.
There’s another inherent plus in moving to services and away from hardware. The more recurring monthly revenue your company generates, the greater equity you will create and the stronger and more attractive your firm will become to lenders and financiers. Lenders and financiers count on contracted RMR as a necessary component in assessing company value, in essence using this to decide whether or not to grant you that loan for capital expansion or other business-related endeavors.
It’s a different mentality, sales approach, and philosophy overall as you migrate away from hardware and into the RMR-rich world of services. And it often takes networking with your peers to hone in on the best way to approach this new way of thinking.
At the RRN Summit, April 9-11 at the Langham Hotel in Pasadena, Calif., you’ll get the opportunity to network with like-minded technology solution providers who want grow their cash flow and become stronger companies in the process. When you attend the RRN Summit, you’ll come away with new insights from your peers and the enthusiasm to get started in these endeavors immediately.
Each of the sessions in the 2 ½-day RRN Summit is designed to help you learn ways to build additional revenue streams from new and existing customers, or provide business process insights to accomplish your goals. In the session: “The RMR Revolution in Networking Monitoring & Management,” presenters will discuss the likelihood of healthy monthly revenue from proactive maintenance services and how to tackle this approach. In “Keys to Converting from a Project-Based to Recurring Revenue Business,” you’ll hear the secrets of success from IT and physical security companies who have moved solidly from break-fit models into the profitable world of services. In “At Long Last, Recurring Revenue Arrives for AV,” attendees will hear how cloud and network based AV systems are creating real and tangible opportunities for RMR.
The RRN Summit is the only conference dedicated to RMR, bringing together the ever-converging disciplines of IT/MSP, AV/Control and physical security technology providers in one place. Explore all the opportunities that are available and we promise – it won’t be like looking for a needle in a haystack.