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Technology VARs are increasingly focused on selling managed services to help small and midsize businesses monitor, manage and maintain their IT networks and equipment. However, according to a study released by CIT Group, a provider of vendor financing solutions, the benefits of offloading IT services-lower costs, increased available resources and reduced IT headcount-are not fully understood by many SMBs.
This lack of understanding serves as the biggest barrier to VARs as they look to sell managed services to SMBs. Managed services offer third-party monitoring, managing and maintaining of computers, networks, software and other IT, according to the report. The research report, “Technology Channel Outlook: Are SMBs Ready to Embrace Managed Services,” prepared in association with Forbes Insights, gathered the views of more than 100 executives at technology VARs and technology channel partners that sell to SMBs.
Nearly two-thirds (62 percent) of respondents agreed (54 percent) or strongly agreed (8 percent) that their customers do not understand the benefits of managed services. As a result, nearly half (49 percent) of those surveyed believed this lack of understanding is the leading barrier they face in trying to sell the benefits of managed services to SMBs. This was followed by overall cost (37 percent) and the desire of SMBs to maintain their own infrastructure (37 percent).
Understanding that many smaller companies see technology as a necessary expense, as opposed to a strategic investment, respondents cited reduced costs (43 percent) as the most compelling benefit of managed services for SMBs, followed by the ability to free up resources to focus on other aspects of the business (37 percent) and reduced IT headcount (33 percent).
In addition, the survey indicated cloud-computing solutions are smoothing the way for VARs to sell managed services to SMBs. In fact, nearly two-thirds (63 percent) of respondents agreed that the popularity of the cloud has made it easier for them to sell managed services to SMBs as customers become more familiar with the concept of software as a service.
When asked to discuss which technologies would have the greatest impact among SMBs over the next two years, more than half (51 percent) of respondents said cloud computing would have the greatest impact, followed by tablets (21 percent) and smart phones (15 percent). Fifty-two percent (52 percent) of respondents also believed that tablets would take the place of laptops for most executives, while nearly a quarter (24 percent) believed that all applications and data storage would migrate to the cloud.
“The findings of this study are consistent with our experience in financing managed service contracts,” said Ron Arrington, global president of vendor finance at CIT. “We have found that the most successful managed services programs are those in which the VAR clearly articulates the offering and quantifies the impact for the SMB. Likewise, when an SMB is committed to implementing a managed services solution, it soon realizes that it can play an important role in the growth plans and expense management of the company.”