IT Services Industry: Buying a Franchise
A recent article in Forbes states that there are roughly 28 million small businesses in the U.S. which employ over 50% of the adult workforce. All these workers need IT services to operate their businesses and to be effective in their jobs, which is why the this industry is ever growing.
Small businesses drive the American economy, but the average small business can’t justify retaining a full-time position devoted to tech services. For this, they must outsource and rely on another service for assistance. This may very well be another small business… a business franchise opportunity for you in IT services.
IT services companies are very fragmented
Although the U.S. IT services industry generates about $340 billion a year, it’s very fragmented. CompTIA found that there are around 118,000 independent computer repair IT companies in the U.S., and most of these are independent tech services providers who work with companies that employ between one and 10 people. On the other side of the spectrum, there are a few recognizable companies that serve large corporations with 500 employees or more. Hoover’s found that the 50 largest IT services companies account for roughly 40% of revenue.
That leaves plenty of room in space inbetween. An IT franchise owner may be well-suited to serve those clients who employ anywhere from 10 to 100 people.
The demand for managed IT services can be show with the studies of First Research, which reports that the IT services industry’s $340 billion in annual revenue is expected to increase in the future. This continued increase in demand for managed IT services places an IT services franchise owner in a position to take advantage of this critical market niche—one that many industry experts see as the future of the industry overall.
Most important capitalization trends
The experts also say that the most successful IT franchises will capitalize on three important trends:
- Small and medium-sized business owners can’t afford to spend the time to research the continuously evolving technology, and they can’t afford to be left behind with their technology to keep their businesses running efficiently;
- The IT industry has grown beyond the “break-and-fix” model of doing business… it’s now a consultative, on-call service model that ensures small and medium-sized business owners have the solutions, applications, and support they require to be relevant and effective in their markets; and
- Managed IT services demand is immensely outrunning the industry’s current ability to supply that demand.
Experts believe that the current IT industry is composed primarily of technicians without the proper training, support, or business expertise to offer the degree of customer service that’s become the norm for today’s business owners.
Outsourcing reduces cash flow issues
An IT franchise can provide outsourced managed IT services to targeted small and medium-sized businesses with a team of certified technicians. They solve IT issues for their customers and act as technology solution advisors to suggest appropriate tools and systems to help their enterprises be more efficient, secure, and accessible. An IT service franchise allows the owner to be a business partner who provide advice and access to new technology solutions that can help make customers more efficient and show a real return on their investment. The franchise owner is a technology advisor to his or her customers, monitoring their technology to avoid significant issues and eliminate downtime.
An IT franchise owner will enjoy a predictable, recurring revenue stream, which allows a degree of stability and satisfaction as the business grows. Industry experts say that managed IT services also offer the prospect of greater profit margins compared to the typical repair work on which most independent IT businesses rely.
Buy an IT Services Franchise
If you are thinking of buying a franchise and would like more information, this link will allow you to buy and download a copy of my book.