Startups have to work with the resources on hand, and it’s a waste to put money into ineffective IT solutions. Investing in Managed IT is always limited by one thing: the cost.
We totally understand. Around 70% of our clients in ITS Chicago are small businesses, and we know how tight budgets can be. We were once a small business too!
Before getting any Managed IT services, you deserve to know how much it’ll cost you. In this article, we’ll take a look at:
- Managed IT in Chicago vs. Other Locations
- 5 Price Factors of Managed IT in Chicago
By the end of this article, you’ll have a solid understanding of how much you can expect to spend on Managed IT if you are a small business owner set on growing your business.
Managed IT in Chicago vs. Other Locations
Hiring an IT professional in Chicago costs approximately $80,000 per year, with $70,000 as the base pay. A significant cost for starting businesses.
This will get you a decently skilled IT technician who can troubleshoot, set up networks, and implement basic cybersecurity protocols. The more staff you have, the more IT members you need to hire, as expertise and knowledge is a valuable, limited resource.
While there are decent benefits of hiring in-house IT versus Managed IT, it’ll cost much more upfront money and time.
Managed IT services in Chicago are only a fraction of that price. If you are a small business you can expect to spend around $1000/month + initial onboarding fees. Being picky with your Managed IT Service Provider (MSP) pushes that price lower.
In fact, a benefit of being located in Chicago is the numerous MSPs in the area. Christopher Philip, an ITS Client Account Manager (CAM) for the Chicago area, said “there are probably hundreds of them in Chicago.”
True enough, the Manifest weeded out the top one hundred out of all these companies, as Chicago’s status as one of the top three cities in the USA contributes to the number of choices you have. It’s also one of the top revenue-earning cities in the US.
Chicago has an MSP for your price point because of its status. If $1000 is too steep for you, you can check mom-and-pop MSPs which may charge you less. However, a lower price point will come with concessions: a smaller company, possibly less industry experience.
On the other end of the spectrum, if you have a sky-high budget (lucky you!), then there are also industry bearers in Chicago that can meet your needs.
Read: “5 Best Managed IT Service Providers in Chicago”
But aside from the MSP, you get service from, what other factors go into the price of your Managed IT plan?
Five Price Factors in Managed IT services
What goes into the different prices of Managed IT in Chicago? 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 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/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 Chicago?
Remember, 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.