How IT Services Companies Price Their Services?

If your company is growing and your IT capabilities aren’t, then you know it’s time to find a new plan. You have two options: hire more IT staff or outsource.

If you choose the “hire more staff” route, then you have to find them (not so easy in today’s job market), train them, pay them, and wait for them to learn your systems and processes.

If you outsource, you don’t have to handle any of those issues, and you don’t have to deal with any of the IT headaches that go with the territory of owning and operating a business.

But what’s it going to cost you?

The truth is that IT services companies price their services so differently that it is difficult to give an across-the-board answer to that question. What we can do, however, is walk you through the most common service delivery and pricing models so that you gain a clearer picture of what you can expect when you ask for a quote.

Service Delivery Models: Fully Managed Vs. Partially Managed

Let’s start with the first question you’ll need to answer: how much of your IT function do you want to outsource?

Fully Managed

If you’re ready to outsource all of your IT needs, you’ll be looking at a fully managed model. In this scenario, the MSP basically becomes your IT department. They will handle all of your network management, security, updates, troubleshooting issues, end-user support, and more. You may hear this model referred to as “All You Can Eat,” which is another way of saying it is all-inclusive.

Partially Managed

With a partially managed service model, you outsource only certain pieces of your IT function. You may choose a monitoring only package, where the MSP monitors activity and alerts and notifies you if something needs your attention. Or you may need specific services like help desk assistance or security support. You have a lot of flexibility in a partially managed model, and the MSP will work with you to develop a plan that meets your needs. For example, you may be able to choose a la carte services to meet targeted needs, or the company may offer a range of service packages to choose from.

Pricing Models: Per Device, Per User, or Tiered

Next, you’ll need to decide which pricing package works best for you based on the options available from the particular MSP you are working with. Most IT services companies offer three pricing models:

  • Per Device – Per device pricing charges a flat fee per device that is part of your network. If each one of your employees uses several devices (e.g., a desktop, a laptop, and a company phone), it can get expensive quickly. It may also be more difficult to budget for this model since the number of devices can fluctuate fairly quickly. However, if your employees each use only one computer, this may be a good option for you.

  • Per User – Per user pricing is also charged as a flat fee, but it is based on number of end-users rather than number of devices. This may be a more cost effective model if your employees use multiple devices. It is also a straightforward cost per employee, making it easy to account for in the budget. 

  • Tiered Pricing – Tiered pricing is based on the services you choose rather than the number of devices or users. Most MSPs will offer a range of packages or service levels with an increasing number of services included. The fee may be charged monthly, quarterly, or annually, and some providers charge less for higher volumes of end-users.

If you’re not sure which option is right for you, start by asking yourself these questions:

  • Do you have an internal IT staff already?
  • What kinds of IT services do you need help with?
  • How much involvement do you want from the MSP?
  • How flexible is your budget? Would an all-inclusive flat fee work best or a low fee for basic services with additional services charged as needed?
  • What IT architecture do you already have in place? How much monitoring and maintenance will it need?
  • Do you need on-premise services, or can your needs be handled remotely?
  • Do you have the resources to achieve your long-term goals with technology?
  • Are you trying to expand your capabilities or maintain what you currently have?

Once you have a big picture idea of your needs, the next step is to begin exploring MSP options in your area to get specific quotes. That’s where we can help! At ITCompanyNearMe, we help you find MSPs in your region so you can get the IT support you need from a company you trust.