When you decide to hire a Managed IT Services Provider (MSP) to support your business’s IT needs, the cost may come as a surprise. What can be more frustrating is that, if you are not technical, buying IT can be difficult and confusing. Surprisingly, very companies talk about the price of managed services and what goes into it. For your ease, we have tried to answer many of the questions that we get regarding Managed IT Services Costs and the underlying reasons behind those costs, in this article.

So read on!

Every Company is Different

Many companies look alike, have similar websites, support similar applications, and even use similar platforms to support their clients. However, if you look from the MSP’s viewpoint, every company is unique and every business model is different.  The IT infrastructure changes from industry to industry as well. Therefore, depending on what industry you belong to and how things work in your business, your total managed IT services expenditure may be different compared to companies that are sized similarly but have different IT complexity requirements.

What Makes Up IT Services Total Cost?

There are many things that go into the costs of the services and as much as we would love to state the exact number in dollars for your convenience, we can only give you a range. When we asked the tech experts at the Acropolis Technology Group who have been serving various businesses for a long time, their comments suggested that,

“Managed IT services costs will range from $50 per user per month to $180 -$190 per user per month”.

As you can see this is a considerably wide range because so many factors related to your business model make up the final cost. In this article, we are going to discuss those factors in detail and help you figure out where your company would fall.

Factors that Influence the Managed IT Services Cost

1.    Number of Users and Number of Devices

The number of users/devices can dramatically affect the price of IT support. In fact, the first few questions any MSP would ask you to answer are designed to get a handle on the size and scope of your organization.  You can expect to answer these questions;

·        How many employees do you have?

·        How many devices per employee are used?

·        Do your employees bring their own devices?

·        What kinds of devices (workstations, hosted servers, tablets, mobile devices, access points, firewalls, etc.) are there?

·        How many offices /  where do your employees physically sit to do their work?

These basic questions should give most MSPs the ability to give you a ballpark cost per user. One simple rule you should remember is that

‘More users would mean more devices and hence more money”.

But why? Simply put, all users and all devices need licenses. Unless your employees use free software, there always will be licenses that you will buy for the company internally and there will be licenses an MSP will buy for supporting your users. These paid licenses cost will add up to your total managed IT services bill.  The MSP may not be making any margin on these costs but instead “pass through” the revenue to the software vendor.  It is important to know what these costs are and how to apply them to your total IT bill. 

2.    The Complexity of the Business Environment

It’s very easy to support a simple business that resides in a single office location with few users working on all standardized equipment and running only one or two off-the-shelf applications. For such businesses, the complexity and hence the service expense is on the lower side and any MSP would seem affordable. However, as the complexity of any business rises so does the complexity of its IT infrastructure and hence the cost of IT support also grows.

When we talk about a typical complex business environment, we refer to businesses that are spread out in multiple locations, have software integrations and customizations, store data on cloud applications and/or private data servers, have numerous access points, and use applications which are connected.  Supporting such an environment takes a lot of hard work because the time it takes to troubleshoot and solve technical issues when they arise is so much more complex in addition to the expertise required to solve issues is greater. That is why MSPs charge higher for complex businesses and the bills soar depending on the level of complexity.

3.    Skill Set of the Users

A very important question to ask yourself before acquiring third-party IT support is how technical is your staff? If your employees are well versed in troubleshooting typical system bugs and issues, they would just search around the solutions on the internet and could possibly “self-help” themselves quickly. They don’t need day-to-day and 24/7 IT support from an MSP to solve their minor issues. However, a staff that has little knowledge of IT would rely a lot more on IT support- in this case the MSP. Of course, more IT support means more cost.

4.    Neediness of the Users

Have you ever seen a surgeon fixing the printer or an attorney troubleshooting the WIFI? Probably not because solving IT issues is typically not their highest and best use. They are professionals such as the doctors, physicians, lawyers, engineers etc who work in high billable environments and the last thing their companies want is to have them self solve their IT problems. These users come under the ‘needy user’ category which means they might not necessarily be non-technical but financially it doesn’t make sense for these billable resources to solve their own IT issues.  The neediness of your user is another very significant factor that impacts the cost of managed IT services. In such cases hiring MSP proves much cheaper than the users having to troubleshoot on their own.

5.    Secondary Vs Primary Support

If you already have a competitent internal IT department which is responsible and accountable for everything technical and you are hiring MSP to just supplement them because,

a)      The MSP has specific tools that your IT department lacks in

b)     The MSP has tools that you don’t want to buy

c)      The MSP personnel have specialized skills that you need but only on a part time basis

d)     The MSP has personnel and a deep bench when your team needs to take time off or is working on a strategic internal project and you can’t afford to let IT issues slip.

In this case, the costs of managed IT services will be less as you just require secondary support and your team is the primary support for your users. Because the MSP is not responsible for fixing everything and only providing supplemental IT support, the charge per user/device can be less because there is just less to do.

On the other hand, if you wish to forego all of the expense of an internal IT team and rather pay a MSP to do everything, the costs will be closer to having your own internal team because the MSP has to take care of everything , fix even the smallest of IT issues and are accountable for every delay and every incident. Not only the MSP will have to dedicate support staff for your company but also send people onsite whenever required. 

6.    Amount of Data

Data is every company’s most important asset and must be protected from cyber theft, misuse and ransomware at all times. Many companies hire an MSP in order to protect and manage their backup data. These backups can be done on cloud storage or data centers. Depending on how much data your MSP will have to manage or backup, the pricing will change. The MSP can charge you anywhere between $5 per month and $500 per month and varies by amount and requirements.

7.    Number of Servers

More servers mean more management which means more cost. AS  the number of servers or virtual machines grows so does the need for maintenance, backups, and security measures.  With each data server used by your company, the MSP will have to spend more hours per server and hence will charge you more. Also, it depends on the fact that whether you want the MSP to just do basic server management or provide advanced maintenance as well. Prices vary from server to server as well, so a simple cloud server may cost you less than a BDR (Backup and Data Recovery) server or specialty on premise server.

8.    Services Required

All MSPs provide a range of services and it’s up to you what services you choose to get.  So first and foremost you must decide what kind of support meet your requirements.  Here are a few guiding questions;

·        Do I wish to upgrade my network security?

·        Do I require a full-scale IT infrastructure setup in my new office?

·        Am I aiming for VoIP (Voice over IP) services only?

·        Do I need cloud services?

·        My business has regulatory compliance issues that I must meet

·        How integrated is my software and operational platforms

Once you decide what services you want from your MSP, you can discuss with them the cost and an idea of what the on-boarding process would entail. You should understand that the cost of services is not fixed. The amount you pay the MSP for its services will increase if your users increase or the service needs expand.  Any mature MSP should be able to give you a very clear picture on what will and will not impact your monthly service fees.

Looking For Managed IT Services?

Although many factors influence the overall cost of managed IT services, we have tried to educate you on the most significant ones only. What we have mentioned is a range in dollars but that’s because support costs vary wildly from one business to another.

If you are in search of a competitive Managed It Services Provider, feel free to contact us anytime at the Acropolis Technology Group. We will be happy to talk to you and work around things that serve you best. We, at Acropolis Technology Group, understand that there is a lot that goes into choosing the right technology partner and the risk to choosing the wrong partner is high.  Give us a call and we would be happy to share our 25+ years of experience with you and help educate you on choosing the right partner that fits your technology and financial needs.  Thanks for reading!