A Guide to the 6 Main MSP Pricing Models

If you’re in the market for a new managed service provider (MSP), then you might be feeling a little lost because there are a myriad of pricing options available in the marketplace.

Having the right MSP on your team is a critical element for any business that relies on IT.

While MSPs may represent a decent annual cost for any business, it is a low price relative to other expenses. It’s also important to know what the different MSP pricing models are, what they offer, and which would be the right choice for your business.

Here are the six main types of MSP pricing models:

 

1. Monitoring Only

As one of the less expensive options, monitoring only is ideal for businesses that operate on a tight budget but also already have their own internal IT team.

For this pricing model, your MSP will provide network monitoring and alerting (in the event of a data breach or security event). But it is up to your existing internal IT team to remediate and deal with any threats that invade your network.

While most MSPs will provide remediation services, they will do so at an extra cost. And if you find that your internal IT team is repeatedly struggling to manage remediation, it may be time to consider replacing them with a fully-outsourced option rather than using monitor-only pricing.

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2. Per-Device

This is a very simple and easy way of pricing out a business’s IT needs.

Essentially, the MSP prices your quote based solely on the type and number of devices covered under the contract. It’s usually a flat fee that can look like:

$X per computer + $Y per mobile device + $Z per server = monthly fees

The services offered in the per-device pricing model usually encompass the full range of repairs, troubleshooting, and cyber security.

However, many MSP businesses tend to differ in their specific service levels, and what they offer per each one. So, make sure your pricing strategy covers all of your IT strategy framework needs that your business absolutely requires.

 

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3. Per-User

Per-user pricing is a lot like per-device pricing, except (as you might guess) this MSP pricing model is priced out according to how many users you have (useful if you have more devices than users).

Here, you’ll be billed per user, per month. This option generally covers all the needs of a user as well (but still check with your prospective MSP to know exactly what services are offered under the per-user pricing model.

This model can also extend to individual endpoint user devices as well (making it an attractive option in our work-from-home era).

4. A La Carte

Do you prefer the freedom to customize your IT MSP service needs? Then the a la carte pricing model might be the right choice for you.

Depending on the options you choose, this pricing strategy may be the more expensive option to take, but with it you’ll receive all the MSP services your business needs, and none of the ones you don’t.

Many businesses choose this particular pricing model because it allows them the greatest level of control over their MSP services, but it can come at a higher cost and also cause your business to miss out on services that your business needs, but internally, your organization might still decide to pass on.

 

5. Tiered Pricing

Tiered-based pricing is among the most common types of MSP pricing models chosen by businesses (even compared to break-fix) and offers various tiers of packages to choose from, depending on your specific IT needs and your budget.
Typical, tiered pricing is based on fixed costs for the aforementioned services packages. But it is often a great choice because it provides comprehensive IT services and management, along with the benefits of IT consulting.

 

6. Value-Based (Flat Fee)

Despite what its namesake suggests, this MSP pricing model is actually very inclusive in terms of the services it offers.
It’s an all-in pricing model where the client (you) pays for one flat annual or monthly fee in exchange for what is essentially an entire outsourced IT department. This includes everything from remote monitoring, threat remediation, cloud migration project planning, and hardware management to procurement, consultation, and vulnerability assessments.

The primary benefit of the flat fee model is that it allows organizations to focus on their own strategic goals, without ever having to worry about IT concerns themselves, like maintaining business continuity best practices.

 

Finding an MSP Pricing Model That Works for You

While there is a lot to consider when it comes to choosing the right pricing model with your MSP, it’s just as important to choose the right MSP.

Here at Technology Advisory Group, we’ve been considered one of the most reliable MSPs in Rhode Island and New England since 1996.

We provide enterprise-level services that go far beyond the typical break-fix approaches. We offer the expert services of our extensive and highly experienced IT department to act as your very own, completely negating the necessity of an in-house option.

Explore our services and service pricing today, and experience a better way to manage your IT.