You’re My Only Hope! Tips to Survive a Recession or Down Economy

Welcome, MSPs! If you’ve been in this industry long enough, you know that the economy has its ups and downs. One minute, business is booming; the next, you’re scrambling to keep everything afloat. Every MSP needs to be prepared for economic downturns!

I’ve been in this industry since 1986—before “MSP” was even a term! Through recessions, slow economies, and all kinds of financial turbulence, we’ve learned what works and what doesn’t. Here are some of the strategies that have helped us and other MSPs survive—and even thrive—during tough economic times.

Cash Is King! Build and Protect Your Reserves

When the economy tightens, cash flow is everything. You don’t want to find yourself struggling to pay bills just because payments are delayed! Having a cash reserve gives you the buffer you need to weather uncertain times.

• Review your expenses and cut out unnecessary spending. Are you paying for tools or services you barely use? Trim the fat!
• Don’t let invoices slide—enforce your payment terms.
• Follow up with clients before invoices are due. Send reminders and get paid on time!

Now is the time to streamline your processes and find cost-effective ways to run your business while maintaining service quality.

Don’t Stop Marketing—Seriously!

When money gets tight, one of the first things many businesses cut is marketing. Big mistake! If you stop marketing, guess what? Leads dry up. Sales slow down. Then, when things finally stabilize, you’re scrambling to rebuild your pipeline…

Stay visible and keep your name in front of prospects and customers. Adjust your strategy, but don’t disappear! Maybe you scale back paid ads, but double down on email marketing or referrals.

Clients notice when you stay engaged. If you normally send out gifts to clients, consider dropping them off instead of mailing them. Keep relationships strong!

Take Care of Your Clients (They’re Your Lifeline!)

Retention is critical during economic downturns. You can’t afford to lose clients, so go the extra mile to ensure they’re happy!

• Proactive communication is key. Regular check-ins, quarterly business reviews, and technology assessments show clients you’re invested in their success!
• Solve their problems and find ways to add value. If they’re cutting budgets, help them optimize their IT spending instead of losing them altogether.

Becoming the trusted advisor and guiding your clients through tough times will pay off!

Recurring Revenue = Stability

If you’re still relying heavily on break-fix work, now is the time to change that. During recessions, businesses cut non-essential expenses. If IT services aren’t urgent, they’ll hold off on calling you. That’s why monthly recurring revenue is your best friend!

Push managed services: clients paying a fixed monthly fee are less likely to churn! Additionally, make sure that you stay confident in your pricing. Some clients may ask for discounts, but instead of lowering prices, highlight the long-term savings and stability that your services provide.

Be Ready Before the Storm Hits

Recessions come and go. The best MSPs are the ones who prepare in advance! Implementing these strategies now will strengthen your business, no matter what the economy throws at you. Stay efficient and, most importantly, keep growing!

I’ll leave you with my favorite quote from Back to the Future: “Your future is whatever you make it, so make it a good one.”

Have a great week!