Before choosing a Managed IT Service Provider (MSP), you need to know if you have enough resources to partner with them. Transparent pricing is a must before dealing with any business.
However, MSPs rarely commit to a final price of a Managed IT plan - even if they do have standardized pricing.
So why does that happen? Why don’t MSPs just tell you how much you’ll pay for IT support?
It’s because Managed IT is a highly customizable service. The answer to “How much does Managed IT cost?” is always going to be: it depends. MSPs will tell you a good ballpark range, but can’t guarantee it’s the final price.
So the best bet is to get as accurate of an estimate as possible. As an MSP ourselves, we’ll help you get an accurate estimate of your Managed IT bill in Detroit.
In this article, we’ll clearly explain:
- Managed IT Cost in Detroit vs. Other Locations
- Managed IT Prices Explained
By the end of the article, you’ll have a clear understanding of the cost of Managed IT in Detroit and why Managed IT prices vary between each company.
Managed IT Cost in Detroit vs. Other Locations
Prices in Detroit, like other locations in America, have risen in the past two years due to inflation and IT equipment shortage. However, the cost in Detroit isn’t as different as you’d expect from other locations in the country. Most prices - especially with MSPs with branches in multiple states - are the same.
If you have 20 workstations, you can expect your Managed IT bill to average out at $3000 per month ($36000 annually). There is also a one-time onboarding fee they’ll discuss with you. These bills go up or down depending on the a) the company you’re partnering with and b) the five price factors of Managed IT.
Usually, small “mom-and-pop” MSPs have a more flexible pricing structure. These businesses often offer cheaper prices at the cost of having less robust IT services. Meanwhile, larger “tried-and-tested” MSPs have a less flexible pricing structure, but will often offer more services than smaller MSPs can offer.
And while $3000 seems like a hefty price tag, it’s still cheaper than the average salary of an in-house technician in Detroit - which is around $49,600.
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Meanwhile, the price of IT Support is affected by five different factors.
Managed IT Prices Explained
We interviewed Tom Andrulis, CEO of Intelligent Technical Solutions, to talk about the reasoning behind Managed IT prices.
According to Andrulis, the price of Managed IT is customized to fit your needs based on five price factors.
- Number of Users
- Number of Servers
- Amount of Data
- IT Support Time Needed
- Services & Upgrades Needed
1. Number of Users
The total cost of your Managed IT plan heavily depends on the number of users in your IT network. Most MSPs charge a monthly fee per user because more users mean more devices to manage, which equals a higher price.
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.”
However, 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, companies should carefully monitor the number of mobile devices or tablets in their network, especially if a Bring Your Own Device (BYOD) policy is in place. 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. Do an inventory of how many users and workstations you want your MSP to manage.
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.
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2. Number of Servers
The number of servers can dramatically affect the price of Managed IT. 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 also usually takes about two to four hours of support per month, per server.”
MSPs need to know the number of servers and need to know how you want your MSP to manage your servers.
Do you want them to handle everything? Do you want all the security features? Do you need different backups for your servers? Do you need to consolidate your servers?
Having well-maintained company servers is part of a robust IT network, so 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, and 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.
3. 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.
4. IT Support Time Needed
IT Support Time is how long 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/user per month.
Always check the time allotted for service in your plan and evaluate if that is enough for your needs.
5. Services & 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.”
How Much Will You Spend on Managed IT in Detroit?
All these factors are bundled together into a single price for your company.
If you’re a small business with 20 users, expect to spend around $3000/month + a one-time onboarding fee. Another good price range is $50-$250/user monthly + an onboarding fee.
Please note, that this is only a starting price range. Experienced MSPs such as ITS will not provide you a final estimate 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.
Even if you’re not yet ready to talk to an MSP, please refer to our guide to Everything You Need to Know About Managed IT. It’ll explain what business owners must know before getting started with Managed IT.