hey how are you guys it is Harrison Baron from growth generators now in this video I want to talk to you guys about how much you should be charging for an MSP service now there is a ton of different varieties and variables that are going to drastically impact how much you're charging and upon doing some research online I have found hundreds of blog posts on how much you should actually be charging now I'm a veteran of the industry I've been in the industry now for going on about nine or ten years and I work regularly with msps and help them not only with their digital marketing but also they're pricing their structure and how they're going to offer these services so I've seen the gamut now when I first started the company that I was working with was charging on average about 35 dollars a seat for unlimited support that is horrible now on the internet if you go and Google it you're going to find anything between 51 up to about 250 plus dollars per seat and I want to share with you guys how you can justify that cost and what you realistically should be charging now where you live is going to depend on how much you can actually charge if you're out in the middle of nowhere nothing against you but you're going to have to charge a little bit less there's just less money out there but if you're in an urban environment near a city like Charlotte New York maybe even San Diego you're going to have a lot more people that are willing to pay more money for good service so let's talk about what's actually included before we get into the nitty gritty and the money of how much you should be charging first is what's actually going to be included a lot of companies say that they do 24 7 support which in the case may be true but for the large majority of them that's not going to be the case a lot of companies will do either a nine to five a nine to six and eight to three sometimes a six to six where they're doing half or a quarter of the day of the work day for somebody to be able to call in and say hey I need support on top of that after that happens usually there's a one or two technicians assigned overnight for smaller companies to handle any other issues or responsibilities that need to be taken care of then again we are in the IT industry which we all know doesn't sleep so what's the difference what are the variables typically when you have somebody sitting down in front of a computer they are going to cost a decent amount of money most employees cost anywhere between 15 on the very very low side level one tech support up to about 45 to 50 an hour depending on their level of education and what tier of support they are tier three support you're probably paying close to that number so that way any customer that has an issue can get that resolved with a level three technician but what about the other variables in between things like patching Project work network monitoring are all part of your package what should be and shouldn't be included well I'm not going to tell you how to run your business I am going to tell you and give you some examples of companies that I have worked with in the past I have seen a 250 dollar all you can eat deal now it's 250 per unit meaning a computer or per person whatever is less and I say that because there are times where multiple people use one computer so it's really you're only working on one computer and there are times where there is one person who has three or four company devices and in that case there's usually a bit of a flex spend in there where you're not charging a thousand dollars for one employee to have four devices on the network so you have to think about what is realistic but that 250 encompasses everything that is including endpoint monitoring a sock team any Project work that needs to get done the company or the person buying the services will be responsible for paying for Hardware but any additional work that needs to be done programming setting up domain anything that is involved in that area even setting up a network closet is included in that 250 dollar price meaning no matter what happens no matter how severe that issue is it's 250 dollars per user or per computer whatever's less and they charge that across the board now the reason why this is nice is because there's really no extra bills that that company has to pay and two there's never any labor there's never any question of whether or not labor is included the only thing additional that the customer is paying for are materials no more time time is completely covered in this build now on the flip side of things all the way on the cheapest side I have seen because I came from it was 35 dollars per seat now I will tell you that this is an un it's impossible to grow a company and build a profitable business at thirty five dollars per seat because we just went over how much you're paying that person per hour now yes the law of scalability does work in this scenario but you still need to keep hiring and hiring and hiring based on how many clients you have and how many teams and technicians you need in order to go execute on those areas I would say a good starting spot for a brand new MSP to roll out things like connectwise endpoint anything else that might be necessary to just get them into being a customer even some basic monitoring usually covered by connectwise or automate should be between 50 and 75 dollars per month that's a basic minimum the reason why I'm telling you this is because you can charge a little bit less than your competitors as you're first starting out and it's going to give you a little bit of wiggle room to add some profitability in there now my personal recommendation that is on the lowest end is realistically between 75 and 100 dollars per month what does that actually look like that's going to cover your endpoint antivirus that's going to cover at least a nine to five nine to six eight to six some kind of combination of those numbers as far as people sitting in a chair when you're first starting if you're not sure you're just starting out try to just stretch yourself too thin and higher as soon as you can to get somebody who can address those issues at least for level one and you could build it in your contract for level two and level three will be handled on these certain areas which you the business owner are probably going to be handling what else should be included network monitoring right off the bat super super important depending on what you're using if it's a Meraki or any other Wi-Fi or network monitoring devices or network devices you should be able to build that in or at least some level of automation to let you know hey monitors down we need to go fix those areas that is the core function of what you should be offering anything additional to that should either factor into that monthly price or project pricing and that is totally up to your discretion a good number that I've seen a lot of companies be able to grow successfully and build and train employees build out appropriate platforms for them to be able to be trained off a 401k really the level where you become a real business is somewhere between 125 and 200 per month C now why is it like that as opposed to the 50 to 75 dollars that I just recently mentioned you're going to get higher quality and higher tier employees typically the less you pay an employee the lower quality person you're gonna get not always the case but that's a general good rule of thumb the other thing is Happy employees get paid fairly well they feel like they're challenged at their job they feel like they are providing a serious service to a client when a client pays you two hundred dollars or 150 or a hundred dollars per month month they expect a quality level of service at fifty dollars that's a little bit more than a dollar or two per day but getting into that 100 plus territory you're talking about multiple dollars per day to make sure an employee is working appropriately now I'm gonna go on to how to actually go sell MSP services in my next video but I wanted to just talk about some other areas that you can charge a premium for if you have the staff on hand to go do it sock a security team in place that can go handle major issues if you're dealing with clients that desperately need this kind of Advantage this is a home run and should not be slept on it usually consists of one or a couple people that can go out and that is their only job is to fix and manage massive security issues that could be rolling up patches that could be dealing with a potential breach that could be dealing with data security whatever it may be for your business adding a sock team will one help you increase the overall cost or price that you can charge charge and two gives customers a lot of Peace of Mind knowing that there is somebody that if something goes massively wrong as far as security goes because we're all involved in security they can call and it's going to get dealt with right away some other areas that I think are worth mentioning that you can charge more per month for is a VI vciso a virtual Chief Information Security Officer this is going to be somebody outside of your organization that you're hiring through your MSP or through the MSP that their own their only job is to go through figure out what's expiring whether it's warranties maybe it's registrations maybe it's licenses and making sure that not only are they being proactive in mentioning hey this is what we're going to need to allocate for future growth next year but also saying hey we have some systems going out of out of date we have a potential new solution for you that we've been researching it might be worth rolling it out let's look at the pros and cons they're really acting like an outsourced virtual Chief Information Security Officer where they're just consistently going out to make sure that not only do you have the best of the best but also you're getting and maintaining a level of security that's going to impact not only the customer that's buying the services but you as the business owner knowing that hey if something goes wrong we actually have it in the budget to go fix these issues this was a serious serious problem that I saw when I was working in the space which is a lot of companies didn't have the budget with their clients to be able to afford and hire these kinds of people inside there's also areas to upsell on a maybe it's five dollars ten dollars twenty five fifty whatever numbers that you feel is appropriate but you could use active track to monitor employee productivity both in and outside of the office you can use programs that are going to see who's inside the office you have RFID scanning to scanning badges which is access control the list kind of goes on and on and what you want to add but as far as a core group of offerings you could use Avic for for monitoring your info your infrastructure the list goes on and on and you could build all of those reoccurring costs that you have to deal with as an MSP into the total price and it's going to give your sales person the ammunition to be able to go in and say not only are you getting 24 7 security you're getting a v sizzo you're getting monitoring you're getting endpoint you're getting all of these additional benefits that go through to be able to show that you guys not only know what you're doing but you're prepared to take care of any situation that might come up including potentially even redundancy backing up a server whether it's on-site or off-site is something that you can bill for and include it into that overall price now before I wrap up this video I want to share with you that two things that I've learned one a la carte can be very dangerous once you get somebody on 24 7 help desk or your MSP monitoring which is hopefully 24 7 or at least somebody in a hot seat for a handful of hours a day outside of that think of other ways that you could provide value to that customer there are so many ways out there including this video but you have to be careful do not do a la carte Services until that they have at least one of your premium Services because customers like to cherry pick and say I don't want this I don't want this and you as an MSP are going to run into some serious problems when you don't have a budget to go take care of issues that the customer is having get them on some kind of reoccurring contract whether that's managed services or maybe it's just backup and you want to say hey this is how we're going to handle your backup and building in enough beef in there that if they do have an issue you can send somebody on site to restore from a backup whatever it may be you have to think about that personally I am a bundler I don't like doing a la carte services at all bundle everything give me one price and it allows the MSP to just execute as they see fit assuming you have customers permission to do so with just about anything hey we want to build we want to set up five new computers they're about five thousand dollars all together it's going to be completely covered in your contract all you have to do is just pay for the hardware perfect customers love that everything's going to be set up the way they want it's going to be dropped off installed everything to the nines which is not only making for a better customer experience but making your job as a business owner and MSP owner a million times easier and that's going to be the difference between somebody struggling to get their feet underneath them versus somebody that is consistently acquiring new customers if you have the means to sell it sell it go for it build in your own package sometimes companies like to have a little more beef with a 250 I've even heard of three hundred dollars per seat which is crazy but if a customer is want to pay that everything should be included other than Hardware no matter what once again it depends on your business but if you're just starting out that 50 to 75 dollars per month is a solid sweet spot to get your feet wet to start building that team to start making some recurring Revenue think about it you get a 10 person company at 50 a seat that's 500 a month that's not a little bit of money but it's enough money to start saying hey you know what if I get two or three or four of these I can realistically have somebody full time in a chair and they could be the backbone and help me grow my business so this is things that you have to think about as an MSP owner I hope this video helps this is purely from my experience in the next video I'm going to talk about how to make more money with your MSP getting creative and thinking about different ways that you can roll out different softwares that's going to increase that reoccurring number a little bit more my name is Harrison Baron from growth generators thanks so much for checking out this video I look forward to seeing you on the next one bye