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Summary

In this conversation, Craig Willard discusses the challenges and implications of bundling Microsoft 365 with managed services. He argues that while bundling may seem convenient, it can lead to complications with pricing, renewals, and profit margins. Willard advocates for separating licensing from service rates to maintain financial health and transparency with clients. He outlines a structured approach for MSPs to manage Microsoft 365 licenses effectively while ensuring clear communication and stable pricing for clients.

Takeaways

• Bundling Microsoft 365 can create pricing and renewal issues.
• Separating licensing from service rates improves financial clarity.
• Maintaining a standard Microsoft configuration is crucial for control.
• Charging a management fee for Microsoft services is essential.
• Clients appreciate transparency in billing and services.
• Separation leads to smoother onboarding and contract management.
• Your margins should ideally be around 70% or better.
• Bundling can inflate service rates and complicate contracts.
• Clear communication with clients about pricing changes is vital.
• Separating software costs helps maintain profitability.

Chapters

00:00 Intro

00:46 Why Bulding Feels Easy .... Until It Isn't

02:32 How We Do It - Standards, Separation, and Control

02:39 Implementing a Standard Microsoft Configuration

03:06 What Happens When You Separate It

03:35 What Happens When you Separate M365 From Your Services

04:23 Transitioning Current Clients

04:40 How To Explain This To Your Clients

05:17 Handling Pushback

06:08 Transitioning Current Clients

06:50 Real World Wins

06:59 Conclusion: The Path to Profitability

07:21 Closing