The Strategic Importance of Your Pricing Model

Your pricing model isn’t just about how much you charge; it’s a fundamental part of your business strategy. A well-chosen model:

• Ensures Profitability: Covers your costs and generates a healthy margin.
• Provides Predictability: Creates stable recurring revenue for you and predictable IT expenses for your clients.
• Communicates Value: Reflects the comprehensive support and proactive management you provide, not just reactive firefighting.
• Simplifies Sales: Makes it easier for prospects to understand what they’re buying.
• Supports Scalability: Allows your revenue to grow with your client base without a linear increase in support costs (ideally).

Common Managed IT Service Pricing Models

Let’s break down the primary managed IT service pricing models you’ll encounter and consider for your business.

1. Per-User Pricing

This is one of the most popular models, especially for modern, cloud-centric environments. You charge a flat fee per user per month, regardless of how many devices they use.

Pros:

• Simplicity: Easy for clients to understand and forecast costs.
• Predictable Revenue: Very stable monthly recurring revenue (MRR).
• Scales with Client: Revenue increases naturally as your client’s workforce grows.
• Device Agnostic: Handles users with multiple devices (desktop, laptop, mobile) seamlessly.

Cons:

• Device Density Variation: Can be less profitable for clients with many devices per user.
• Defining ‘User’: Need clear policies for shared accounts, contractors, etc.
• Add-on Complexity: Often requires separate pricing for specific services like servers or specialized applications.

Typical Range (Illustrative): $75 - $150+ per user per month, depending on included services and client size.

Best For: Businesses with a relatively consistent device-to-user ratio, heavy reliance on cloud services, and clients who value cost simplicity based on headcount.

2. Per-Device Pricing (Per-Endpoint)

With this model, you charge a flat fee per device (endpoint) per month. This could include desktops, laptops, servers, mobile devices, and sometimes network devices.

Pros:

• Clear Inventory Link: Directly ties pricing to the number of assets you manage.
• Good for Device-Heavy Clients: Can be attractive to businesses with many shared devices or unique hardware needs.

Cons:

• User Variation: Doesn’t account for users with multiple devices.
• Complexity: Requires careful tracking of all devices.
• Potential for User Support Issues: If a user has problems across multiple devices, the per-device model doesn’t reflect the potential support time tied to that user.

Typical Range (Illustrative): $50 - $100+ per endpoint per month for workstations, higher for servers ($200-$500+).

Best For: Environments with a clear, stable number of devices per user or where device management is the primary focus. Less common now than per-user for general end-user support.

3. Tiered Service Packages

This model involves creating multiple service tiers (e.g., Bronze, Silver, Gold; or Basic, Standard, Premium) with different levels of service included in each tier. These tiers often combine per-user or per-device elements with different service scopes.

Pros:

• Catches Different Needs: Appeals to a wider range of clients with varying requirements and budgets.
• Clear Upsell Path: Encourages clients to move to higher tiers for more comprehensive support.
• Manages Expectations: Clearly defines what’s included and what’s not at each level.

Cons:

• Complexity in Design: Requires careful thought to define what goes into each tier to avoid scope creep or perceived unfairness.
• Client Confusion: Too many options or unclear differences can confuse prospects.
• Difficult to Present: Static quotes or spreadsheets can make comparing tiers and adding options cumbersome for clients.

Typical Range (Illustrative): Basic: $50-$100/user; Standard: $100-$150/user; Premium: $150-$250+/user (examples using per-user base).

Best For: Most SMB IT support businesses today, as it provides flexibility and structure. Presenting these tiers interactively is key – a tool like PricingLink (https://pricinglink.com) is specifically designed to make presenting complex tiered options and add-ons clear and engaging for your clients, unlike static PDFs.

4. Value-Based Pricing

This advanced model focuses on the outcomes and business value you deliver, rather than just the cost of providing the service (per user/device). It requires a deep understanding of the client’s business and how your IT services contribute to their success, efficiency, or risk reduction.

Pros:

• Higher Profit Potential: If you deliver significant value, you can command higher prices.
• Aligns Incentives: Your success is tied to the client’s success.
• Differentiates You: Moves the conversation beyond commoditized IT support.

Cons:

• Difficult to Implement: Requires significant discovery, trust, and the ability to articulate and measure value.
• Client Skepticism: Some clients may be hesitant if they don’t fully grasp the value proposition.
• Requires Business Acumen: You need to understand the client’s industry and operations.

Typical Range (Illustrative): Varies wildly, could be a percentage of cost savings achieved, a flat fee based on perceived value, or incorporated into high-tier packages.

Best For: Experienced MSPs targeting specific niches, delivering strategic IT consulting alongside support, and clients who view IT as a strategic asset rather than just a cost center. This is often layered on top of a foundational per-user or tiered model.

Implementing and Presenting Your Pricing

Once you’ve decided on the managed IT service pricing models that fit your business and target clients, implementation and presentation are critical.

1. Calculate Your Costs: Know your Service Delivery Cost (SDC). What does it actually cost you to support one user or one device per month? This is essential regardless of your model.
2. Define Scope Clearly: Precisely document what is included and excluded in each tier or per-user/per-device fee. Avoid ambiguity.
3. Consider Add-ons: Offer optional services (e.g., advanced security, specific application management, project work) as add-ons to increase flexibility and average deal value.
4. Simplify Presentation: Your pricing needs to be easy for prospects to understand. Static PDFs or complex spreadsheets can be confusing. Modern tools allow clients to interact with options.

This is where a platform like PricingLink (https://pricinglink.com) can be powerful. It lets you create shareable links (`pricinglink.com/links/*`) where clients can select their desired users, devices, tiers, and add-ons, seeing the price update instantly. It’s a focused tool for creating a modern, interactive pricing experience that saves you time and qualifies leads effectively.

While PricingLink excels at interactive pricing configuration, it’s important to note what it doesn’t do. It is not a full proposal tool with e-signatures or contract management. For comprehensive proposal software that includes these features, you might look at tools like PandaDoc (https://www.pandadoc.com) or Proposify (https://www.proposify.com). However, if your primary goal is to modernize how clients interact with and select your pricing options specifically, PricingLink’s dedicated focus offers a powerful and affordable solution at just $19.99/mo.