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Posted by Stefanie | May 12, 2016

IT by the numbers: You hired an MSP… but what are you paying for?

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In this series, we have been talking about the ins and outs of managed IT services and when you should consider partnering with a managed services provider. During months without outages or the need to add new users to the system, business owners may wonder what exactly their MSP subscription payment is covering. If you’ve ever found yourself asking “What should I be getting for the monthly managed IT services fee?” the short answer is: a lot.

To us, “a lot” means having access to a professional team that your business may not otherwise be able to work into its budget. Partnering with a managed IT services provider is essentially the same as partnering with a CPA firm to do your taxes – you want to work with folks who are professionals in their field, able to make work as trouble-free as possible while operating within your financial parameters. A managed IT services provider accomplishes this by providing an entire team of people with a wide variety of skill sets and specializations.

So, let’s take a look at the breakdown of managed IT services for an average-sized client. We chose a MyITpros CPA client with 40 employees.

Customer profile – CPA firm

  • Total managed IT services bill: $4,500/month
    • 1 site
    • 40 computer users/employees
    • 2 SaaS (Software as a Service) apps
    • 4 client server line of business apps
    • Productivity apps

Now, let’s break down that ambiguous monthly “IT services” fee into six major managed service categories to give you a better sense of the resources that contribute to that $4,500 price tag.

Major service categories and cost

50% End user support: Desktop maintenance & management, software maintenance & licensing ($2,250)

20% Server/network maintenance, management & support ($900)

15% Security management: Firewall, EPS, etc. ($675)

5% IT strategy, planning & budgeting ($225)

5% Vendor management: ISP, VoIP, SaaS, etc. ($225)

5% Procurement: Software, hardware, devices, etc. ($225)

The category that requires the largest amount of resources is end user support. This makes sense considering that managed IT services providers are in the service business, so being responsive when someone has an issue is a top priority. Although the other categories compose the same cumulative resource percentage as end user support (50%), the individuals required to perform specialized functions such as server maintenance, security management, budgeting, vendor management and procurement are the most highly skilled and costly resources. Those higher-level functions are really what separate highly performing businesses from those who are often, if not perpetually, in firefighting mode.

Whenever you pay for a service, it’s important that the service provider is transparent about what you’re getting for your money. Take the time to ask
questions about where your business’ hard-earned dollars are going and what kind of benefits you get for your buck.

Byron Attridge SalesByron Attridge, Sales Consultant

The goal f this blog is to answer the questions you ask! For more information around our managed services, check out the services page for descriptions and pricing. I'd love to talk to you- so please email me at prospects@myitpros.com!

Tags » Budgeting for IT