by Scott Jack
Content Contributor, E-N Computers
Over 10 years of experience in healthcare IT and tech support.
When considering managed IT services, one of the first things small businesses usually worry about is managed IT service pricing.
You likely already know that your business could benefit from managed IT services. The technology you rely on needs updates and security monitoring. Your staff need someone they can ask for technical assistance when things aren’t working right. And you need guidance on integrating tech into your business, a practical tech roadmap, and an IT budget.
With the right managed IT service, you can stop worrying about tech problems and start focusing on your business. But how are managed IT services priced in 2023, what do you get for that money and how can you avoid hidden costs or being nickel and dimed by your IT MSP?
QUICK ANSWER:
How are managed IT services priced?
For a small business with up to 20 employees, expect to spend $2,000 to $3,000 per month on fully managed IT services; a medium business with 50 employees will spend $5,000 to $7,000 per month. The exact pricing breakdown will vary between IT MSPs. Some MSPs require a 1-year minimum contract and an onboarding fee equivalent to one month of support — but our plans are month-to-month with no onboarding fee.
Table of Contents
- Ballpark estimates of managed IT service pricing per month
- Factors that affect managed IT service pricing
- Managed IT service pricing models
- What’s included in managed IT service pricing?
- How much do MSPs charge per hour?
- Hidden costs of managed IT service pricing
- Make an informed decision before spending
Ballpark estimates of managed IT service pricing per month
Before we dig into the nitty-gritty details of IT MSP pricing, you might like to see a rough estimate of what you can expect to spend. We’ll give two estimates here—one for businesses of 10-20 employees and one for businesses of about 50 employees. This covers the two most common sizes we see.
- 20 employees: $2,000 to $3,000 per month
- 50 employees: $5,000 to $7,000 per month
Now, what are some of the factors that affect managed IT service pricing?
Factors that affect managed IT service pricing
Business size. The cost of managed IT services increases with the size and complexity of the business. The number of staff, the number and type of devices, and the number of locations can all play a role in the price you pay.
Level of support. Managed IT service pricing is also affected by which services are being provided. Some businesses only want remote monitoring and patching of their servers and workstations, which will be less costly. Others are looking for a fully managed, turnkey IT department, which will be on the more expensive end of the spectrum. Still others are looking for a partner to complement their onsite IT team.
Onsite vs. remote support. A wide variety of issues can be resolved remotely, so many IT MSPs focus on providing remote support and only do onsite visits when necessary. Onsite support increases costs but comes with significant benefits. We include regular onsite days in our plans to perform maintenance and keep documentation up to date.
Compliance. If you need to be compliant with regulations like DFARS/CMMC or HIPAA, you can expect to pay more for managed IT services. Your MSP will make sure all technical safeguards are in place and documented.
Ballpark managed IT service pricing
Users and Devices
- 20 employees
- 50 employees
- Server
- Network
- Workstation
- Mobile
- $2,000 – $3,000 per month
- $5,000 – $7,000 per month
- $200
- $75
- $100
- $45
Managed IT service pricing models
Managed IT service providers use a subscription model to generate monthly recurring revenue. These plans are geared toward companies with at least 10 users. Many IT MSPs have you sign a 1-, 3-, or 5-year contract; some —like us—offer our services on a month-to-month basis. The monthly price is based on either 1) the number of users or 2) the number and type of devices.
Pricing per user
Some market their services as “all-inclusive” or “unlimited”, while others offer good-better-best tiered plans to meet the needs of a variety of customers.
If you’re looking at an “unlimited” plan, find out what it includes. Though the goal is to avoid nickel-and-diming you, there are usually soft limits in place to avoid misuse. For example, we offer unlimited help desk calls during regular business hours. In rare cases, you might be charged for an extended help desk call that would have been more appropriate for your onsite day (e.g. a lengthy software installation).
Pricing per device
Per device, or a la carte, pricing allows you to choose the specific hardware you want to support. Each type of device — server, network, workstation, and mobile device — has its own flat rate. On average, the rate schedule would look like this:
- Server: $200
- Network: $75
- Workstation: $100
- Mobile: $45
Tiered pricing
Per user or per device prices may be mixed with tiered plans. A good-better-best model is common, with certain services or more rapid response times being restricted to a more expensive tier.
At ENC, we use ‘charge per user’ with tiered plans. Our plans are designed for companies with an IT person that need behind-the-scenes support (called co-managed IT), companies that need a turn-key IT department (fully managed IT), and companies that need to meet strict compliance requirements like CMMC. We also offer a basic plan for remote monitoring and management. You can always find the latest details on our Pricing page, which includes an managed IT service pricing calculator.
What’s included in managed IT service pricing?
There are some common components of managed IT services. If you get a quote that is significantly lower than others, it could be that they are leaving out one of these or are providing it in a reduced capacity. Some common features of managed IT service pricing plans include:
Network maintenance. Just like your computers and servers need to be updated and maintained, so does your network equipment. Your IT MSP will make sure network modems, routers, and switches are functioning, running the latest firmware, and providing the best network speeds possible—both internally and when connecting to the internet. Some IT MSPs will work directly with your ISP during service upgrades and outages, known as vendor management.
Data backup and recovery. MSPs usually provide a basic level of data backup and recovery. For most small businesses, this will include daily onsite and offsite backups going back 30 days. Data recovery will require manual intervention. You will be encouraged to keep spares of essential hardware on hand.
Remote monitoring and patching. Your IT MSP will monitor your network for potential security risks like unauthorized access or malware and will take steps to remedy any problems. Your MSP will automatically update server and workstation operating systems to maintain performance and security.
Help desk and technical support. Most users will contact the IT MSP’s help desk by phone or email. Some offer a 24/7 help desk; others provide a local help desk during regular business hours and charge for after-hours support. Most technical support will happen remotely. Depending on the IT MSP, onsite visits may cost extra.
Strategic planning. At its core, strategic planning is about making sure you’re using the right technology to meet your business goals. Your IT MSP can help you choose the right technologies, plan a roadmap to implement them, and help you create a realistic budget so that you can upgrade on a regular schedule.
How much do managed IT service providers charge per hour?
Hourly rates for many IT MSPs are in the range of $100 to $200 per hour. These rates apply to break-fix services, projects, and after-hours support. The exact hourly rate depends on several factors, including:
- the level of technician required,
- whether it is for after-hours or holiday support, and
- the risk or urgency of the task or project.
At ENC, we charge between $125 and $175 an hour, depending on the technician assigned. Our hourly rate applies to projects and after-hours support. In rare cases, we may charge for help desk calls that go beyond 15 minutes. In such a case, the help desk technician recommends escalating the issue to be handled during your onsite day. If you require it to be handled over the phone, your account manager has discretion to bill for the additional time. This allows us to keep the help desk available for all client calls that can be quickly resolved.
Hidden costs of managed IT service pricing
There are a few categories of work that aren’t included in managed IT service plans. At some point, you will need one or more of these and should find out how your IT MSP charges for them. At ENC, you’ll always know the cost of the work before it begins.
- After-hours support. When you call after hours, the on-call technician will determine whether the call warrants an emergency response or can be handled the next business day. If it requires an immediate response, you will be charged an hourly fee.
- Project work. One-off projects (like installing new network equipment) require significant planning and resources in order to minimize disruption. These projects are charged separately from routine administration and support.
- Software upgrades. Software upgrades, such as the installing the latest major version of an operating system or the annual release of your accounting software, are treated like a project. They require additional planning and resources, vendor support, backup verification, and a plan to limit downtime.
Make an informed decision before spending
Now that you know what managed IT service pricing involves and why, there’s one other thing to have clearly in mind. Before you start looking at IT MSPs, know what your goals, strengths, and weaknesses are—in IT and your business as a whole. Our IT Maturity Self-Assessment can help you identify areas where you can improve. Try it for free today!
Here are some further resources to help you while you are searching for IT services and comparing costs:
- How much does IT support cost in 2023? This article compares the total cost of ownership between in-house and outsourced IT support
- Break/Fix versus managed services – What’s the Difference?
- Should I build or buy an IT department? This article compares the pros and cons of using in-house IT versus outsourcing your IT services.
- 7 steps to choosing a managed IT service provider
Take the IT Maturity Assessment
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You’ll get personalized action items that you can use to make improvements right away. Plus, you’ll have the opportunity to book a FREE IT strategy session to get even more insights into your IT needs.
