How to Avoid Getting Nickeled & Dimed by Your Managed Service Provider

How to Avoid Getting Nickeled & Dimed by Your Managed Service Provider

Most companies have already discovered that partnering with a managed service provider (MSP) can save them a lot of money, but those savings are not guaranteed. That’s because not all MSPs are the same — the services they provide and the fees they charge for them can be vastly different.

The managed services methodology has been around for several years now, which has given many IT providers time to develop more sophisticated pricing…but some still abide by the old “nickel-and-dime” rule.

Here’s how you can avoid hidden charges when engaging in a managed services agreement.

Understand Your MSPs Pricing Model

Some managed service providers attempt to nickel-and-dime their customers with seemingly hidden nuisance charges whle others are pretty straight forward in their billing process. If you want to avoid these nasty surprise bills, it’s important to read your contract carefully and understand your MSPs pricing model to know exactly what is and is not covered by your agreement.

Here are a few of the most common methods by which managed service providers structure their pricing:

Per Device Pricing or Per User
If you are paying for managed IT services on a per-device basis, you will want to fully understand when the extra charge for a new device kicks in. Will you incur an extra charge if a visitor connects their tablet or smartphone to your wireless network? What if an employee connects a device to the network without your permission? Does per user include everything or just one device? Understanding exactly what triggers the extra charges is the best way to avoid being nickel and dimed by your IT provider.

Time Based Pricing

If you are paying for your managed IT services on an hourly basis, you’re not really engaged in a true managed services plan. Either way, making sure your plan includes regular monitoring of the network can help you avoid unnecessary charges and expensive downtime. A good managed IT service company does much more than provide help desk support and break/fix service. They also proactively monitor all the devices they are responsible for, from the workstations in the customer service department to the servers in the data center, for potential problems. If a problem is detected, the managed IT service company takes action, diagnosing the issue and fixing it remotely as quickly as possible.

Making sure that this proactive monitoring is part of the package can help you avoid trouble and
 keep your network up and running. The break/fix process is an expensive one, and paying on an hourly basis can make matters worse. The downtime you are experiencing is already costing you a lot of money. The hourly fee just adds to the expense.

“All You Can Eat” Pricing

Many MSPs now provide unlimited, or all-you-can-eat, support for their clients. That means that all devices and users are supported, and there is no additional charge for bringing new devices or employees on board.

Depending on the needs of your business, this all-you-can-eat approach to managed IT services may provide the best value. If your firm needs a high degree of flexibility, this approach to managed IT allows you to ramp up quickly without incurring additional expenses. If scalability and fast response are critical to your business, this managed IT approach lets you focus on the needs of your business without regard to maintenance and support costs.

Managed Services are Great, Just Know Your Agreement

If you do not want to get nickel and dimed by your IT services company, you need to do your homework and read your contract carefully. Be sure you understand exactly what is — and is not — covered by your contract. If your managed services company provides data backup and storage, make sure there is not an extra charge for data recovery and retrieval. If your contract calls for regular software upgrades, is there an additional cost for emergency updates and security patches?

The answers to questions like these can make a big difference in the predictability of your IT expenses. Find out more by downloading our free Guide to Managed Services.

Garrett Chipman

Garett is an IT executive and entrepreneur with more than 20+ years in providing and designing business technology solutions. Coming from the technical and CTO/management side of such companies as GRB Entertainment and AMG(Artist Management Group) he has implemented some of the industry’s most effective solutions to help produce efficient results. He engaged with 100’s of vendors and thought during his CTO time and thought – Why not pass this methodology down the small and medium sized businesses? Why not provide enterprise solutions, for the SMB market at a fraction of the budget of hiring full time staff? His entrepreneur side kicked in at that point. This is why he started TVG Consulting. Anybody can put equipment in, but it’s the way one uses technology it making sure it a productive solution and does it make sense. Garett manages overall company decisions and operations for TVG and acts as TVG’s chief client design architect. Garett is acts as their clients strategic Virtual CIO which they include in their services. Garett and his wife Clare live in Southern California with their 2 kids and are very active in their local non-profits and community driven causes.

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