Managed IT brings many benefits for organizations, but why are so many Managed IT Service Providers (MSPs) so squirrely about the price? Is it truly so hard to give out a direct quote?
Well … unfortunately, yes. A straightforward pricing guide can only do so much. As much as we want to give our clients at ITS a quote immediately, we still need to delve deeper into each client’s needs.
After all, Managed IT prices depend on a lot of factors.
If you’re looking for an easy answer, in Phoenix, it costs roughly $1000/month + a one-time onboarding fee to start with Managed IT.
But the answer to the question “How much does Managed IT services cost?” is more complex than that.
So in this article, we’ll explain the following points:
- Managed IT in Phoenix vs. Other Locations
- Five Price Factors in Managed IT services
By the end of this article, you’ll know the intricacies of Managed IT in Phoenix and the five factors that affect the price of Managed IT.
This information will help you decide if Managed IT is feasible for your growing business.
Managed IT in Phoenix vs. Other Locations
Let’s say you want to start with in-house tech. The average base salary for IT professionals in Phoenix is $56,224, roughly the same as the national average wage.
For this price point, you’ll get IT staff with general skills in cybersecurity, data management, and troubleshooting. A specialized team member will cost you more.
But this doesn’t count the IT infrastructure and all the people you need. If you were to get all the equipment provided by Managed IT services, it’d cost even more.
Luckily, you have the pick of the top MSPs when getting Managed IT in Phoenix.
Read: “5 Best Managed IT Service Providers in Phoenix”
Many MSPs have clients that have been with them for years, as Managed IT contracts are usually set for more than one year. (So be careful when choosing a company – you’ll be with them for a while!)
According to Brian Kaminsky, ITS Phoenix Partner, “Honestly, I would say 90%, just to be fair, has come from our current base of and grown. We’ve done a lot more growth account management and provide a lot more value to be able to build more from within.”
Costs for Managed IT in Phoenix are also a bit cheaper than in other locations. Here, the price for Managed IT in Phoenix can also go as low as $500/month + onboarding fee if a) you’re a small team, b) you have a small number of services from your MSP, and/or c) you partner with a small MSP.
But of course, the price will always depend on the following factors.
Five Price Factors in Managed IT services
What goes into the different prices of Managed IT in Phoenix? We interviewed Tom Andrulis, ITS CEO, to explain the factors of a price plan for Managed IT.
The five factors, he said, are:
- Service Time Required
- Number of users
- Number of servers
- Amount of data
- Services and Upgrades Needed
1. Service Time Needed
Service time is how much time you and your MSP talk while fixing an IT issue.
“The amount of technical time changes from company to company based on the complexity. Some networks are very basic and require very little time to support, while others are much more complicated,” Andrulis said.
As a business owner, you need to figure out the amount of service time required for your company. Ask yourself:
- How big is your IT network (number of users, workstations, servers)?
- Do you need proactive maintenance and support?
- Do you need to have after-hour and weekend support?
- Is your business’ IT system running 24/7?
- Do your usual IT problems take a long time to fix?
- Do you have recurring IT issues, or are they usually a one-time problem?
Andrulis added, “The bigger the network, the more time it takes to support. Usually, when companies get over five employees, they require a recurring amount of support from month to month.”
Price Range for Service Time:
Service time is either billed hourly or as a recurring cost.
If you’ve hired a break-fix company instead of an MSP, you’re on an hourly rate. Hourly service time is often $150 to $250/hour but can go up or down depending on the company you’ve hired.
Managed IT Service Providers include service time in the plan you get with them. Plans for only service time can range from $50 to $150/per user per month.
Always check the time allotted for service in your plan and evaluate if that is enough for your needs.
2. Number of users
More users mean more devices to manage, which equals a higher price. Do an inventory of how many users you want your MSP to manage.
According to Andrulis, “The more users, the more support is needed. Based on our stats across 6,000 users, it takes about one to one and a half hours of support per user, per month.”
Some MSPs charge per workstation (aka per device) instead of per user. If your company has strictly one device per user, MSPs charging per workstation is cheaper.
But if you have multiple devices for a single user, a per-user charge is more practical.
Also, count all mobile devices or tablets in your network, especially if you have a Bring Your Own Device (BYOD) policy. Some MSPs offer a separate Mobile Device Management (MDM) service for any tablets or phones on your network.
Having an exact number of users in your network makes your estimated costs much more accurate.
Price Range for Each User:
You can expect to spend between $50 to $250/user per month. The price changes on the other factors and – in rare cases – goes up to around $400/user per month.
3. Number of servers
The number of servers can dramatically affect the price of support. Just like increasing the number of users equals higher prices, having more servers is more expensive.
Andrulis explained why.
“More servers equals more complexity on the network and firewall, more backups, more security measures,” he said. “It usually takes about two to four hours of support per month, per server.”
Aside from the number of servers, ask yourself how your MSP will manage your servers.
Do you want them to manage it? Do you want all the security features? Do you need different backups for your servers? Do you need to consolidate your servers?
Even if you don’t have a server, prepare for a conversation about getting a server. MSPs usually recommend servers for growing companies, as it’s essential for most companies.
Price Range for a Server:
If you’re a small business and want to buy a server outright, expect to spend $1000 to $3000 to set up one server. The cost for a server goes up or down depending on its use and its hardware.
Server prices also went nuts during the COVID-19 pandemic – supply chain problems, equipment shortages. Prices shot up, and servers are still pretty expensive to build.
Another option MSPs provide is getting a server with the MSP instead of building your own. There is a lower upfront price but a monthly fee for the server.
For example, at ITS, our cloud servers start at $185 per month, while a Backup and Data Recovery (BDR) server will start at $200 per month. Other MSPs will also have price ranges between $200 - $500 for servers.
4. Amount of Data
Data is pretty complex. For in-house IT, the cost for data storage is different from the cost of protecting it.
But most MSPs bundle in data protection with data storage – when they have your data, they need to protect it too.
Many issues like cybercrimes, faulty equipment or software, or human errors come up that can affect your data. An MSP doing its job right fools you into thinking these issues don’t exist.
Like users and servers, more data requires more storage and more management, which results in a higher fee.
Price Range for Data Management:
Data storage has a huge price range. You might spend anywhere between $5/month (for directly bought cloud storage with no maintenance) to $500/month (for maintained data storage with backups).
Most MSPs bundle data protection and management with their data storage plans.
5. Services and Upgrades Needed
After considering the previous four factors, prepare a checklist of services you want.
Will you be working with them to improve your network’s security? Are you going to ask them to set up your entire IT infrastructure and manage your devices? Will you need cloud services or VoIP services? Are you on outdated software and need an IT overhaul?
Go through the Managed IT plans of each MSP candidate. Each MSP offers different services for each Managed IT plan. Here, Andrulis advises companies to think big.
He said, “Companies must consider managed service pricing in unison with bigger priorities: complying with government regulations like HIPAA, CMMC, Gramm-Leach-Bliley, or multiple local or remote locations, or expanded work from home staff.”
Find an MSP that has a plan with all services you need.
But finding an MSP with all your needs isn’t the last step.
After all, there are future upgrades to consider. Technology moves quickly – for example, the tech world is shifting to Windows 11, less than a decade since Microsoft launched Windows 10.
Get an MSP that takes future tech upgrades into account.
“Nothing lasts forever… eventually, your brand-new computer or server will become old and will need to be replaced,” Andrulis said. “Other times, you might decide to move your office or invest in new technology to help streamline your business.”
Price Range for Services & Upgrades:
The price range for services will wildly vary. Expect spending between $50 per month to $1000 per month, depending on the size of your company and the services you need.
These costs can, of course, go up if your company has a lot of users or has specific, intensive service needs.
How Much Will You Spend on Managed IT in Phoenix?
Ah yes, the end-all-be-all question of everyone thinking of getting Managed IT.
If you’re a small business, expect to spend around $1000/month + a one-time onboarding fee. Another good price range is $50-$250/user monthly + an onboarding fee.
But, this is only a starting price range. Experienced MSPs such as ITS will not give you a final price without asking specific questions about:
- Service Time Needed
- Number of Users
- Number of Servers
- Amount of Data
- Services and Upgrades Needed
To get an exact Managed IT price for your company, schedule a meeting with us.
But if you’re not yet ready to talk to an MSP, take this with you: a guide to Everything You Need to Know About Managed IT. It’ll explain what business owners must know before getting started with Managed IT.