The three common billing models
1. Billing by effort (hourly rate)
You call when something does not work and pay for the time needed to fix it. Travel costs for on-site visits often come on top.
- Advantage: You only pay when something actually comes up.
- Disadvantage: Costs fluctuate strongly. And because every call costs money, people often call too late. A small backup warning then turns into a major outage.
Suitable for businesses with very few devices and IT that needs hardly any maintenance.
2. Prepaid hours
You buy a fixed package of hours in advance, for example for a quarter, usually at a slightly lower rate. Unused hours expire or are carried over, depending on the contract.
- Advantage: slightly cheaper than individual hours, good for plannable projects.
- Disadvantage: Ongoing tasks such as updates and monitoring are often not covered. You have to keep track yourself of when the hours are used up.
3. Monthly flat fee (managed IT service)
You pay a fixed amount per month, usually calculated per workstation, per device or as a total price. In return, the provider takes care of updates, data backup, antivirus protection and monitoring on an ongoing basis and helps when problems occur.
- Advantage: fixed, predictable costs. The provider has its own interest in preventing problems from arising in the first place.
- Disadvantage: You also pay in months in which apparently nothing happens. That is only true at first glance, though, because updates, backup checks and monitoring keep running in the background.
What determines the price
Regardless of the model, the costs depend mainly on these points:
- Number of workstations and devices: An office with three computers and one printer needs less maintenance than one with ten workstations, a server and a NAS.
- Server and network: Your own server, a NAS or several locations increase the effort for maintenance and monitoring.
- Cloud services: Many small businesses work with Microsoft 365 today. The licenses come on top of the support costs and are usually billed per user and month.
- Response time: The faster help has to be guaranteed, the more expensive the support. A same-day commitment costs more than handling within two working days.
- On site or remote: Most things can be solved remotely. On-site visits require travel and are therefore more expensive.
- What is included in the price: This is the most important point when comparing. Two offers with the same monthly price can include very different services.
How to compare a flat fee with hourly billing
A simple rough calculation shows whether a flat fee is worthwhile for your business. All you need are the offers you want to compare and a rough idea of how often your IT needs help.
- Estimate problems: How many hours did problems, setups and questions take up last year? A look at last year’s invoices helps.
- Add maintenance: Updates, backup checks and monitoring take time regularly, even without problems. Allow roughly one hour per month for this.
- Calculate: Both numbers of hours together, multiplied by the hourly rate, give your annual cost when billed by effort.
- Compare: Set this against twelve months of the flat fee and check what each option includes.
If both totals are close, there is a lot to be said for the flat fee: you know in advance what your IT will cost per year, and ongoing maintenance prevents many problems before they arise. If the total billed by effort is clearly lower, your IT is manageable, and prepaid hours or billing by effort are a better fit.
What matters is not only the total at the end of the year, but also what an outage costs. If the office cannot work for a day, working time, appointments and sometimes deadlines are lost. These costs never appear on an IT invoice.
How ITCK bills
We do not tie you to one model; we adapt to your business. The price is agreed individually, depending on the number of devices, the scope of support and the required response time.
- Maintenance contract with a monthly flat fee: for businesses with several workstations, a server or a NAS that do not want to look after their IT themselves. It includes updates that we test ourselves first, backup checks, monitoring of your systems and an agreed amount of support time with one dedicated contact.
- Prepaid hours: for businesses with few devices or irregular needs. You book a package of hours in advance at a lower rate, we bill in 15-minute increments, and you can see at any time how much credit is left.
- Billing by effort: for individual jobs, for projects such as a new server, and to get to know each other. We bill the actual time with a clear record of the work done.
Our suggestion for getting started: Start with billing by effort or with prepaid hours. After three months, we review the actual effort together and recommend the model that pays off for your business. We can discuss switching models at any time.
What to look for when comparing
Ask the following about every offer:
- Are updates for Windows, programs and the firewall included?
- Is the backup only set up, or also checked regularly, including a restore test?
- What response time is promised, and does it also apply to on-site visits?
- Are remote support and calls unlimited, or is there a limit?
- What does work outside the flat fee cost, such as a new workstation?
- How long does the contract run, and how can it be terminated?
- Is there one dedicated contact, or a ticket system with changing technicians?
Conclusion
For most small businesses with several workstations, a monthly flat fee is the better choice. Costs are predictable, and ongoing maintenance prevents many problems before they bring the business to a standstill. If your IT is very manageable or you only need help occasionally, prepaid hours or billing by effort are often cheaper. Compare offers not only by price, but by what is actually included.
More about ongoing support: Managed IT Support.