When businesses engage a Managed Service Provider (MSP), they expect reliable, efficient, and secure IT support. What’s less visible—but just as important—is that many MSPs deliver their services using a network of third-party vendors for things like cloud platforms, backup solutions, and cybersecurity tools.

This isn’t a flaw in the model—it’s a feature. MSPs leverage best-in-class technologies from specialized providers to deliver scalable, cost-effective solutions. But if those vendors fail or create legal or operational exposure, it raises important questions: Who’s responsible? What recourse does the client have? And how can everyone stay on the same page?

We work with both MSPs and the clients who rely on them, and we’ve seen that the most successful, long-term relationships are built on clarity, fairness, and proactive alignment around third-party involvement. Here’s how that’s done.

Acknowledge the Shared Reality of Third-Party Tools

Most MSPs don’t build their own cloud servers or write custom antivirus software—they integrate trusted tools from specialized vendors. That makes business sense. But it also means that if a vendor fails, the client may suffer, even if the MSP did nothing wrong.

That’s why both sides benefit from recognizing third-party risk upfront. Clients avoid the frustration of unclear liability. MSPs avoid disputes or blame for things beyond their control.

Clarify Responsibilities in the MSA

The Master Services Agreement (MSA) should clearly address third-party vendor use. Key provisions include:

• Which services are delivered via third parties.
• What level of responsibility the MSP assumes for third-party tools.
• What happens if a vendor changes, discontinues service, or experiences an outage.
• How clients will be informed about vendor transitions or new integrations.

Well-drafted agreements set expectations early—reducing disputes and supporting trust on both sides.

Support Transparency and Communication

Clients should know who’s behind the tools that keep their operations running. MSPs don’t need to disclose every vendor relationship, but transparency around key service components—data storage, cybersecurity, backup and recovery—is essential.

We often recommend building in:

• Disclosure of primary vendors used for mission-critical services.
• Notification requirements for vendor changes that could impact performance or risk.
• A framework for client consultation where appropriate.

This keeps everyone informed and aligned, and helps avoid surprises that could strain the relationship.

Build in Practical Remedies

For clients, it’s important to have fallback options and remedies if a third-party tool underperforms. For MSPs, it’s important not to be held accountable for issues they can’t control. The right agreement can balance both needs.

That may include:

• Pass-through service levels and warranties.
• Service credits or alternative remedies if a vendor causes significant disruption.
• Defined processes for escalation, mitigation, and response.

This approach avoids finger-pointing and focuses on keeping the client operational—a win for everyone.

Prevent “Vendor Creep”

Over time, an MSP may change or add vendors, especially as technology evolves. But without a process to manage those changes, clients may be exposed to new risks or unfamiliar tools.

We often include change management provisions that:

• Require MSPs to notify clients of major third-party changes.
• Allow for discussion or consent where the risk profile materially changes.
• Preserve the trust that comes from transparency, without burdening operational flexibility.

A Stronger Foundation for Partnership

MSPs deliver tremendous value—and they do it best when both sides of the table understand the structure of the services being delivered. Clients benefit from clarity and control. MSPs benefit from managing expectations and reducing legal risk.

We help structure agreements that reflect these realities—creating clear, practical, and fair frameworks for success. Whether you’re an MSP looking to strengthen client relationships or a business evaluating an MSP agreement, we’re here to help.

Want to review your current MSP agreement or prepare for a new engagement?

Let’s make sure third-party vendor issues don’t get in the way of great outcomes. Schedule a Call to get started.