Pricing MSP Services

Introduction

• Presenter: Harrison Baron from Growth Generators
• Topic: How much to charge for MSP (Managed Service Provider) services
• Background: 9-10 years in the industry, assists MSPs with digital marketing and pricing structure

Industry Pricing Overview

• Historical Context:
  • Initial company charge: $35 per seat for unlimited support (not sustainable)
  • Online research shows prices range from $51 to over $250 per seat
• Geographic Influence:
  • Pricing varies by location (urban areas can charge more than rural areas)

Service Inclusions

• Common Misconceptions:
  • Many companies claim 24/7 support, but often only provide limited hours
  • Typical support hours include: 9 to 5, 9 to 6, or similar
• Support Staff Costs:
  • Tiered support pricing ranges from $15 (Level 1) to $45-$50 (Level 3) per hour
  • Additional services like patching, project work, network monitoring can be included in pricing

Pricing Examples

• All-You-Can-Eat Deal:
  • Example: $250 per unit (computer/person) includes:
    • Endpoint monitoring
    • Security operations center (SOC) team
    • Project work
  • No additional labor costs; materials are extra
• Lowest Viable Pricing:
  • $35 per seat is unsustainable for growth
  • Starting range for new MSPs: $50-$75 per month for basic services
  • Recommended minimum: $75-$100 per month for proper coverage

Core Services for Pricing

• Essential Offerings:
  • Endpoint antivirus
  • Basic support hours (9-5)
  • Network monitoring
• Recommended Pricing to be Competitive:
  • $125-$200 per month to attract quality employees
  • Clients expect higher quality service with higher fees

Upselling Opportunities

• Additional Services:
  • Offer premium services like:
    • SOC team for security issues
    • Virtual Chief Information Security Officer (vCISO) for proactive security management
• Miscellaneous Monitoring Services:
  • Employee productivity tracking
  • Access control systems

Sales Strategy

• Recommendation Against A La Carte Pricing:
  • It can lead to budget issues and unhappy clients
  • Focus on bundled services for better client experience
• Importance of Recurring Contracts:
  • Secure clients with managed services contracts to ensure steady income

Conclusion

• Importance of Correct Pricing:
  • Proper pricing helps in building a sustainable business model
  • Aim for a balance between competitiveness and profitability
• Future Topic:
  • Next video will discuss how to increase earnings through creative strategies in MSP service offerings.