Insider Intelligence: RMR Myths Busted

Nov. 12, 2019
Four common reasons integrators cite for not moving to a recurring revenue model debunked

We have all been reading about recurring revenue models (RMR) across the industry and why one is so important for an integrator’s business, valuation and future sustainability. At PSA, however, we have seen a slower adoption among integrators than we anticipated.

While the progress may be slow, the team leading PSA’s Managed Security Service Provider (MSSP) program is still plugging away working to prove the value to integrators and the security community as a whole. We have rounded up some of the common reasons why integrators say they are not ready to take on RMR just yet and are “myth-busting” these so-called challenges.

Myth #1: The upfront investment is too costly.

Busted! PSA recommends integrators in its MSSP program ramp up slowly with managed services. Aim to have 10 percent of your company’s revenue come from RMR in the first year, 20 percent in the second year, and so on. Slowly continue to grow this aspect of your business as you become more experienced.

Sit down and make a plan of what products and services you would like to add to your recurring revenue business. Start by ranking what may be most important – or perhaps easiest – and focus on that. Similarly, seek outside financing if you need to. In the long run, your bank will be much happier if you have recurring revenue on your books and will be more willing to help finance your growth.

Myth #2: I don’t have time to invest in changing my business model.

Busted! We believe you do not have time NOT to start focusing on adding managed services to your business model. This may be the most common pushback we get when talking to integrators about our MSSP program; however, PSA’s leadership team firmly believes this will eventually be the predominant business model in our industry. A common truism is, “you must adapt or you die.” This may sound extreme, but if you do not start taking steps to future-proof your business now, it may be too late when you finally get around to it…and then you will have plenty of spare time.

Myth #3: My end-user isn’t interested in managed services.

Busted!  Perhaps your customer does not understand how much easier you could make their life by managing services for them. I have been an end-user, and if my security integrator had come to me with a solution to help me access my cameras remotely, lock down doors, have a service to recover lost data, etc., I would have jumped at the opportunity. Integrators must teach their end-user customers the value of managed services – if done correctly, you will make yourself invaluable to them. Start offering your customers these services before another integrator does.

Myth #4: I would have to hire a whole new team to implement managed services.

Busted! Your existing team is more than capable of selling and implementing managed services for your business. At PSA we are seeing this daily across our education platform, events, etc. As our MSSP vendors come in and train our team, as well as our integrators’ teams on how to sell their product and manage it day-to-day, the excitement and understanding is visible. You can teach and old dog new tricks, and while change can be hard, it is necessary for growth. If you pick the right vendors to help support your new managed services program, they will have the expertise to help your team adapt.

The benefits of a recurring revenue model are too great to miss out on: improving your company’s valuation, more stable cash flow, making yourself invaluable to your customers, the list goes on! If you need help dipping your toe in the water, the managed services experts at PSA can help it seem much less overwhelming.

Candice Aragon is the Director of Marketing for PSA Security Network. Request more info about PSA at