It would be really nice if some people stepped up to the plate here and took a moment to explain the pricing structure that is working for them. I know I would be very appreciative of anyone else's insight in this area.


Legacy Forum Name: Sales and Marketing,
Legacy Posted By Username: Alan M

Everyone has the same dartboard that they use for pricing

I've heard people charging $60/Wks and $300 Server for all inclusive.

That seems high to me.

I usually go anywhere between $15/wks Basic and $35 Complete

$100/srv to $300/srv complete

Add this caveat. It all really depends on the customer.




Legacy Forum Name: Sales and Marketing,
Legacy Posted By Username: rvines

We charge depending on number of workstations.

1-10 is $60/wrks , 2 help desk calls up to 2 hours each free

11-20 is $50/wrks , 4 help deak calls up to 2 hours each free

21 - plus is $45/wrks , 10 help desk calls up to 2 hours each free

All onsite visits are billed at a rate of $85/hr and any remote/help desk calls are billed at $60/hr at 15min increments.

Servers are $100 a server.

All inclusive except backup. Back ups us $15/wrks and $60/server per month. However this includes full BMR restores on tap. We havent had any space hogs yet so we do not have a structure for amount of data. Most of our clients only use us as BMR restores.

With this we give monthly reports as well.

All these charges are monthly charges. For examplea network with 12 PCs and 1 server with backup (no backup on wrks) would be $760 a month.

This has worked well for us. We already had some existing clients from the old way we did things, but we only went live March 1st and we manage 130 machines so far and we just started advertising on Monday on the radio.

God Bless,

Marty


Legacy Forum Name: Sales and Marketing,
Legacy Posted By Username: MissingLink

How is the advertising going?

Legacy Forum Name: Sales and Marketing,
Legacy Posted By Username: rvines

Hasent been going long enough to really tell. We havent had any sales leads yet from it. However the radio station we are working with told us not to expect really any calls from the ad for a month or so. So we expected the slow turn around. We are also thinking of maybe someother ways to advertise as well.

God Bless,
Marty


Legacy Forum Name: Sales and Marketing,
Legacy Posted By Username: MissingLink

But charging for the number of calls, or charging per hour is break/fix? How is this a managed service? You must be including something for the monthly charges in terms of managed services? Sorry, I'm a bit slow...

Legacy Forum Name: Sales and Marketing,
Legacy Posted By Username: raybarber

Well we do not charge for the time up to the the alloted time for remote/phone/email support. The one thing that is different about us is that we do not sell nor mark up hardware unlike most everyone else. So the only thing we charge for is out time. We do go on site at least once a month to hand deliver monthly audits and to spend some time discussing with the client about the audit as well as discuss future changes or additions. We think that if you did nothing but a flat rate for managing and repairing then you run the very large risk of loosing money.For example say you have a client that pays you $200 a month. Something breaks and you have to dispatch a tech to fix some items. For arguments sake say he has to spend 8 hours on site to correct. You pay this tech (the ones your trust with critical servers anyways) $25 an hour not counting benefits. So you pay him $200 for that one incident. There goes your "profit" for the month from that client. Not including any other small incidents for that client like helping with Outlook problems or email questions. Regardless of how small they are they still require a payed tech to spend time your paying him for fixing. Now I know that some people say you play a game when doing this, you have heard you lose on some and make on others. But we have decided we didn't want to run that way. We do alot for our clients and don't charge but it is all things we can do quickly or with a single email to answer. We have actually found that many people respect this way of thinking. Because of the way that we bill and what we bill for, we can be completely un-biased in what we recommend to the clients. We don't have to worry about price margins on this hardware or this product, we give the client the best possible decision for there business. We worry about the problems and the network while the client gets on with business. So in a nutshell this is why we bill the way we do.

God Bless,

Marty


Legacy Forum Name: Sales and Marketing,
Legacy Posted By Username: MissingLink

I think it is always hard for MSP's to find 'balance' in this way. Yes, you need to always ensure you have not exposed your business to too much risk, as that would not be at all sensible. Most MSP's seem to find that their customers a 'sensible' about their expectations and do not expect huge amounts of service for no money, it seems you have found the same. Very useful, thank you very much for the input.


Legacy Forum Name: Sales and Marketing,
Legacy Posted By Username: raybarber

MissingLink,

You mentioned that you charge $15 & $60 for backup (desktop & server, respectively). What does that include? Do you provide the storage that stores the backup? Or just the backup software via Kaseya? Do you take anything offsite? Or are these tiny installations where you can FTP the images offsite via Internet?

We're struggling with adding the backup model into our MSP pricing and whether to include the storage equipment and/or fire-proof media safes as part of our service offering. Our clients have too much information to transfer full images offsite via Internet.


Legacy Forum Name: Sales and Marketing,
Legacy Posted By Username: kentschu

There are a number of costs involved and then you have to think about profit.

Costs:

• Kaseya license
  
• NAS Device or USB Drive
  
• Labor to configure backup
  
• Labor to swap backup
  
• labor to manage whatever server holds your images
  
• cost of that server (purchase and Maint)
  
• cost to manage the whole process
  
• liability and risk

I have the same issue justifying getting involved for a measly $60/mo for a server.

I just came from training and the way people do it is to put a NAS device onsite and run the full backup. They then either take that back to their office and copy it or copy it to another nas/usb device and then just run incrementals which CAN be ftp'd offsite. They do this every 3 or 6 months. Or I guess until the incrementals get too big.

But for me to send someone onsite to swap the device and then the time to copy it, I've eaten up a lot of that $60.

The kaseya backup does offer great functionality as far as disaster recovery. Having an on/offsite image of a server would save the client a lot of money in the event of a catastrophic failure. I'm just having trouble convincing clients to pay what it really costs.

What options does a client have?

• Tape Backups - Tape Backups are expensive and managing them does take time, so that is one comparison
  
• Third Party Offsite backup - can be expensive depending on the amount of data. This is another comparison. Take the amount of data that the client would need to go offsite and get a quote from Evault or DPS. Take a server with 50GB, the offsite company charges $638/mo min + $100 for the backup appliance. Another company's minimum is $125/mo for 5GB or less.

Kaseya offers workstation/server imaging and bare metal restore which can be a big selling point.

At $60 per server, I think you're losing money any way that you look at it. I would be interested in the math to come up with that price.



Legacy Forum Name: Sales and Marketing,
Legacy Posted By Username: rvines

Well since I have made that post we have made some changes to our backup pricing. The $15 and $60 were first attempts at the pricing and we found them to be a little difficult to implement into our model. Here is what we have done.

We have options that can be added to an existing management plan.

BMR option for Servers : $350 set-up, $15 a month

What we do here is we come on site with a USB drive, make a full image of your server after we have configured it or cleaned it up, then we hold this image of site at a secure location. Then every 6 months we return and perform another full image overwriting the last image and again keep off site. This way your have a server image that is no older than 6 months. This is done to keep any new software or configurations in an image format in case we have to recover fro ma failed HD. Now I know that we could offer incremental but have decided not to perform incremental in the imaging department. The $15 a month is to cover storage/refreshes. What is NOT covered is restores. If for some reason you HD does die and need replaced. We have the image, but it is billable time. Also we charge the same $500 set-up for everyone but re-use USB drives and hold multiple images. This way we maximize our equipment usage and profit.

Data Backup option: $15 month per gig with 30 days retention (folder only backups)

The one thing to remember here is that depending on how much the DRC (Data rate of change)is it is not feasible to perform off-site Internet based backups. You have to look at how much time it takes to back up the data based upon how often your backing it up, link reliability, risk, etc. So we only offer this option to people who haveless than3gig of data andno more than aDRC of 1gig a week. The retentions can be increased but it increases the price. The customer "provides" the external USB drive in this option. That way we backup to the USB first then offsite. As you can see the profit off this is limited, but thats because we limit the amount of data that can be backed up. If a customer is over these amounts we suggest tape based backup with daily rotating tapes and weekly offsite pick ups. For tapes with actually use another local company that will come on site and pick up the tapes and hold them in there facility. In this situation we interface with the local company andour customer to insure that the tape is beingpicked up and brought back on correct time frames. We figured we could come on site and charge to hold the tapes as well, but the amount of money would not justify the time to do it.

So this is were we are at the moment. However backup/DR/offsite is hard to price and be competitive. That is what we have been finding out.

God Bless,

Marty


Legacy Forum Name: Sales and Marketing,
Legacy Posted By Username: MissingLink

What I'm learning is that people want to deal with one person/company to meet as many of their needs as possible, and parceling out your services bit by bit should be avoided altogether insofar as it is possible. BackUp/DR/Offsite is not unique, but as a part of your total server package it makes your service plan unique, and that much more valuable, and that much easier to sell. If you have trouble replicating across the WAN due to bandwidth constraints, just make sure you address their needs another way. People don't care how you do it, they just want the fastest possible recovery in the event of any sort of disaster, and they are willing to pay equally for the result rather than the methods employed.

I wouldn't even do the paperwork on a service that billed at $15 a month, much less assume any level of liability, unless I really thought I was going to make something big on the back end.

Marty you can just take this for what it's worth, but I think you should be trying to figure out how to up your monthly and forget about charging for the onsite visits. Creating the larger revenue streams will add much value to your business, whereas a client who may or may not call you at some point will not.






MissingLink wrote:

However backup/DR/offsite is hard to price and be competitive. That is what we have been finding out.

God Bless,

Marty

Legacy Forum Name: Sales and Marketing,
Legacy Posted By Username: Alan M

Alan M wrote:

What I'm learning is that people want to deal with one person/company to meet as many of their needs as possible, and parceling out your services bit by bit should be avoided altogether insofar as it is possible. BackUp/DR/Offsite is not unique, but as a part of your total server package it makes your service plan unique, and that much more valuable, and that much easier to sell. If you have trouble replicating across the WAN due to bandwidth constraints, just make sure you address their needs another way. People don't care how you do it, they just want the fastest possible recovery in the event of any sort of disaster, and they are willing to pay equally for the result rather than the methods employed.

I wouldn't even do the paperwork on a service that billed at $15 a month, much less assume any level of liability, unless I really thought I was going to make something big on the back end.

Marty you can just take this for what it's worth, but I think you should be trying to figure out how to up your monthly and forget about charging for the onsite visits. Creating the larger revenue streams will add much value to your business, whereas a client who may or may not call you at some point will not.

I agree with you about the one person/one provider idea. In fact that is how we like to operate as well. We have to be realistic in what we can chargefor certain services. The larger clients are nice, however, we still have to pay the bills while waiting on the "larger" clients.I don't want us to get what I call "Cash Cow Disease". I have a good friend right now that has aweb application development firm (using ColdFusion) that is doing real well for himself. Went from him and his wife to 12 employees in about 3 years, however, over 70% of his revenue comes from one company, and that scares him to death. Because he knows if that company decides to stop using them, his business is sunk, so he is trying to diversify and get more "smaller" clients.We have about 25 clients at the current time with about 200 total workstations in management. The average client is about $225 a month recurring revenue. We have some that are only $100/month and some that are $450+/month. You are correct that $15/monthly is very small, but if trying to charge more for backup services keeps us from getting a client because they are not "willing" to spend that much money for theredata then we have possible lost any potential revenue from them. And think of it this way, that $15 is per image of every machine you want to image. And once the image is made, no other work is done. So that $15 is small, but, is "free". I understand exactly were you are coming from. I come from a NOC/Data Center background and understand that the equipment to backdata up and keep it available or reliable safe can be expensive.. (Just ask a consulting client of mine that just purchased a $600,000 NetApp 64TB R200 per my suggestion for a disk-disk-tape backup routine using bleeding-edge Veritas Netbackup 6.0 ) but the thing we have to keep in mind is that most of the clients that will be candidates for Managed services (I will say 2 - 50 PCs, more depending on a few factors) Do not have the money to purchase items such as this or the money to pay a large amount for services. If they did, they would hire an IT admin instead of us. We do though take good care of our clients. We make sure that whatever method they choose (tape, offsite, etc.) is well implemented and monitored to make sure that there data is safe.

Alan I appreciate and welcome your comments. It is tough to find the right balance for what needs to be billed and what dosent. I think a good deal of that question can be answered by were your market resides, larger town or smaller.

God Bless,

Marty


Legacy Forum Name: Sales and Marketing,
Legacy Posted By Username: MissingLink