Your company’s size, industry, location, product, or service offering – these are some of the factors that affect managed IT services pricing.

If you’re considering employing the services of an IT company, you should first understand the pricing structures available.

In today’s post, let’s take a look at managed services pricing models and the factors that influence them.

What is Managed IT Services?

Firstly, let’s briefly talk about what these services are.

Nowadays, more and more companies are adopting digital processes and IT infrastructure to integrate into their day-to-day operations.

Essential business functions such as system management, network, application, server, payroll, sales, administrative, backup, and recovery processes are usually covered by managed IT services.

Before we dive into managed IT services pricing, here are the benefits of employing this type of service.

Proficiency

For small business owners, in particular, outsourcing IT proficiency can be incredibly advantageous for them, as well as having experienced IT support available anytime.

Predictable Expenses

Instead of shouldering a hefty cost for any IT-related problem, business owners can account for future issues within an expected and agreed upon recurring managed IT services pricing.

Maintenance and Upgrades

Business owners don’t have to worry about having the latest version of the necessary software they need for their business functions. The IT company they hire can take care of that. They are also privy to newer technologies they can take advantage of to enhance their operations.

Time Savings

Your in-house staff can save valuable time and resources by not worrying about managed IT services.

Types of Managed IT Services Pricing Models

The three types of managed IT services pricing models are a flat-rate pricing model, a per-user pricing model, per-device pricing model.

Flat Rate Pricing Model

This pricing model covers all IT services – not just individual projects or separate tasks. This is the costliest managed services provider pricing model. Even so, it’s still increasingly valuable and popular among small to medium-sized business owners.

With the flat-rate pricing model, the managed services provider is granted the role of your company’s outsourced IT team. If an issue arises, for example, with your server, your managed services provider can help.

The assistance they provide you will depend on the arrangement you agreed on before starting the contract. However, if it’s a severe issue that could require a long time to fix, the managed services provider would have to charge an hourly rate – depending on the level of expertise of the IT technician.

While this is the most expensive managed IT services pricing model, it’s the option that allows business owners to have a safe and predictable budget allotted for their IT functions. Also, under this model, if you add users, install more equipment, or upgrade to new devices, the pricing stays the same.

Per-User Pricing Model

Organizations that have employees using multiple devices and equipment can significantly benefit from using this type of pricing model. As the name suggests, you only have to pay for how many users you have. The rates monthly (or weekly) will vary depending on how many users you had for that period.

This is the most commonly used pricing model, but for some equipment, such as the server, this model wouldn’t work. However, for services such as workstations or the help desk, this is the pricing model that makes sense.

Per-Device Pricing Model

This managed IT services pricing model will charge organizations depending on how many devices they use and what these devices are. There’s usually a flat fee for every category of device: desktop, server, or firewall.

This pricing model streamlines the pricing diagram for a variety of service levels. It also makes it simpler for IT providers to outline their services and rates.

Pricing Tiers

Implementing pricing tiers allows managed services providers to work with their clients in providing their unique business needs.

A La Carte

Organizations can specify exactly what services they need and have precise control of their IT budget using this pricing tier.

Partially Managed Approach

This pricing tier allows outsourced IT providers to handle specific tasks. This model works when you already have an internal IT department.

Completely Managed IT Services

As opposed to the previous option, the outsourced IT team will have full control and management of your IT stack. This is the perfect solution for business owners with no dedicated IT team.