Inside the Third-Party Maintenance Market: What Investors and TPM Leaders Need to Know

By Chris Smith, Author & TPM Growth Consultant

The Third-Party Maintenance (TPM) market has quietly become one of the most resilient and misunderstood segments of the IT services industry. While investors are increasingly drawn to its recurring revenues and infrastructure-critical nature, many underestimate the operational complexity that separates high-quality TPM businesses from the rest.

At Baby Blue IT & Consulting, we work with investors and TPM owners who want clarity grounded in real-world execution.

A Market of Winners, Followers and Pretenders

The TPM market is not a level playing field. It is shaped by top feeders and bottom feeders, global players and regional specialists, and a growing number of new entrants chasing margin without fully understanding the risks.

Some providers control the customer relationship, pricing, and renewal cycle. Others rely heavily on channel dependency, subcontracting, or price-led churn. Understanding where value truly sits, and where it quietly leaks, is critical for anyone investing capital or running a TPM business.

Global Scale Isn’t Always the Advantage It Appears

Bigger is not always better. Global reach can introduce cost, complexity, and service dilution if not governed correctly. In many cases, regional or niche TPMs outperform larger competitors through density, customer intimacy, and tighter cost control.

We help investors assess when scale genuinely creates value and when it erodes margin and service quality.

The Industry’s Uncomfortable Truths

TPM businesses are often reluctant to talk openly about:

• Real churn levels and renewal volatility
• Margin erosion masked by short-term growth
• Rising parts, logistics, and labour costs
• OEM pressure around firmware, licensing, and “win-back” strategies

These factors materially affect valuation and long-term returns. Ignoring them doesn’t make them go away.

Growth Is Often Locked Inside the Existing Customer Base

The strongest TPMs don’t just sell maintenance, they expand intelligently. Upsell and cross-sell opportunities across infrastructure, operating systems, and adjacent services frequently deliver better returns than new logo acquisition. The key is knowing what customers will actually buy, not what looks good in a board deck.

Data Is Collected. Insight Is Rare.

Most TPMs are data-rich and insight-poor. Analytics are often used for reporting rather than decision-making. We focus on the metrics that genuinely drive behaviour: renewals, margin leakage, sales productivity, and early churn signals; cutting through noise and vanity KPIs.

Professionalising Sales Without Slowing It Down

For TPM owners, growth is rarely constrained by market demand. It is constrained by sales execution. Over-engineered reporting, unclear incentives, and unfocused go-to-market models hold businesses back.

We help TPMs simplify sales operations, improve renewal performance, and deploy direct, channel, or hybrid go-to-market strategies with the governance required to make them work in practice.

Operators, Not Theorists

Much of the industry commentary is shaped by analyst firms whose models reflect the agendas of a few large players. That has its place but it doesn’t build TPM businesses.

We have grown TPMs from the ground up, worked alongside sales teams and engineers, and partnered with investors focused on real returns. We understand where to invest, where not to, and why.

Before You Buy. Before You Scale.

If you are an investor considering the TPM sector or a TPM owner looking to accelerate growth, improve margins, or reduce churn, talk to people who have done it, not just studied it.

Contact Baby Blue IT & Consulting:
📧info@babyblueit.com or 01234 412320

Real insight. Real experience. Real returns.