You’ve automated service delivery. Monitoring and alerting run themselves. Your RMM workflows are solid, PSA integrations work smoothly. But there’s one critical business process that most MSPs are still running like it’s 2005: getting paid.
While you’ve been perfecting your technical operations, tens of thousands—maybe hundreds of thousands—of dollars are sitting trapped in your accounts receivable. Earning nothing. Waiting for checks that take forever and credit card fees that eat your margins.
Fix Finance Ops First, Growth Second
Here’s an uncomfortable truth: most MSPs approach growth backwards. They pour money into marketing campaigns and hire sales development reps while their existing cash flow bleeds out through inefficient payment processes.
It’s like trying to fill a bucket with holes in the bottom.
The MSPs who win the next stage of growth understand something fundamental: fix finance ops first, growth second. You can’t sustain aggressive sales and marketing initiatives if your cash flow is unpredictable and your working capital is constantly tied up in slow-paying receivables.
Every day your money sits in accounts receivable? That’s a day it’s not available for growth investments that actually move the needle.
Here’s what this looks like for a $1M MSP
Let’s make this concrete with a $1 million MSP example. This is where the “thin air” money reveals itself:
Current State (Typical MSP):
- Monthly revenue: ~$83,333
- 50% of clients pay by check (34-day average collection time)
- 50% of clients pay by credit card (faster, but still not optimized—maybe 20 days)
- Average cash tied up in AR: ~$74,000
Optimized State (Payment Automation):
- 80% of clients paying via ACH on autopay (6-day collection time)
- 20% paying via credit cards or checks with fees passed to customers
- Cash tied up in AR: ~$21,000
The “Thin Air” Result:
- One-time cash flow improvement: ~$53,000 (freed from faster collections)
- Additional annual savings: $15,000 (eliminated processing fees)
- Total first-year impact: ~$68,000 in improved cash position
This isn’t new revenue you have to earn—it’s money that’s already yours, just trapped in inefficient processes.
Why most MSPs are absorbing unnecessary fees
Here’s where most MSPs are unknowingly bleeding margin: they’re absorbing credit card processing fees as a “cost of doing business.” But there’s a better way.
In our $1M MSP example, let’s break down the hidden fee structure:
- Current credit card volume: $500,000 annually (50% of revenue)
- Processing fees at 3%: $15,000 per year
- Five-year cost: $75,000 in absorbed fees
Modern payment systems flip this equation. Instead of absorbing fees, you can:
- Transition clients to ACH payments (near-zero processing costs)
- Pass credit card fees to customers who choose to pay with cards
- Maintain pricing competitiveness while protecting margins
The psychology is simple: when clients see a 3% convenience fee for credit card payments, most will choose the free ACH option. Our data shows that MSPs using modern payment platforms typically see 75% of clients adopting online payment methods, with the majority choosing ACH over credit cards.
The result? That $15,000 annual fee disappears entirely—either eliminated through ACH adoption or passed to customers who prefer card payments.
What you can do with the extra cash
Now here’s where it gets interesting. With $68,000 in improved cash position, this $1M MSP can make strategic investments that seemed impossible before:
Sales Development Investment: That freed-up capital can fund a dedicated sales development function—whether that’s hiring internally or outsourcing to specialists who can generate qualified leads consistently. With proper sales development, a $1M MSP might realistically target 15-20% annual growth.
Lead Generation Acceleration: Instead of choosing between cash flow and marketing spend, you can invest in proven lead generation strategies. Digital campaigns, strategic partnerships, and marketing automation tools become feasible when you’re not constantly worried about making payroll.
The Compound Effect: Here’s the beautiful part—improved cash flow creates a virtuous cycle:
- Better cash flow → Marketing investment capability
- Marketing investment → More qualified leads
- More qualified leads → Higher revenue
- Higher revenue → Even stronger cash position
- Stronger cash position → Bigger marketing budgets → Accelerated growth
A $1M MSP that improves to $1.2M with this foundation now has even more working capital to reinvest. The math starts compounding quickly.
Apply the same thinking to your payment processes
If you’re reading this, you already understand automation’s power. You’ve seen how automating technical processes eliminates manual work, reduces errors, and scales your operations. The same principles apply to your revenue operations.
Leading payment automation platforms now integrate directly with PSA systems, automatically sync with accounting software, and create frictionless payment experiences for clients. On average, MSPs using modern payment automation see 75% of their clients adopting online payment methods—a dramatic shift from the check-heavy processes most MSPs still endure.
The result? Collections that happen in days instead of weeks, eliminated credit card fees, and significantly less time spent on manual billing tasks.
The bigger strategic benefits
The real power isn’t just in the cost savings—it’s in the strategic flexibility. MSPs with strong cash flow can:
- Pursue acquisitions when opportunities arise, rather than waiting for SBA loan approvals
- Weather economic uncertainty with stronger reserves and predictable cash flow
- Invest in high-growth services like cybersecurity or cloud migration without cash flow concerns
- Expand geographically with confidence in their financial foundation
- Attract better talent by offering competitive compensation packages
Strong financial operations don’t just save money—they create options. And in a competitive market, options often matter more than raw efficiency.
Making the switch
Most MSPs have spent years perfecting their service delivery automation. They understand that manual processes don’t scale, that automation reduces errors, and that systematic approaches beat ad-hoc solutions every time.
The same logic applies to financial operations. Manual billing processes, check-based payments, and absorbed credit card fees are the technical debt of your revenue operations.
This is exactly the kind of strategic thinking we build into Alternative Payments—not just automating payments, but aligning your entire financial infrastructure to support aggressive growth rather than constrain it.
The Bottom Line
Your next major growth initiative might not require raising capital, taking on debt, or finding new revenue streams. It might simply require accessing the money you’ve already earned, faster.
The cash flow for your next sales hire, marketing campaign, or strategic investment could be sitting in your accounts receivable right now. The question isn’t whether you can afford to invest in growth—it’s whether you can afford to keep your working capital locked up in inefficient payment processes.
The money is already there. You just need the right system to access it—and the right strategy to put it to work.
