Recurring revenue for your computer repair business is how you will stay in business. It helps you plan, budget and have a successful business. It’s also great for your clients. Having their computers maintained and monitored is much better than waiting for a disaster to happen. It also gives them a way to budget for their technology needs.
I had a client that recently had a bad virus infection. The virus infected all of their documents and their accounting system. Their business came to a halt as soon as the virus hit. They called late on a Friday afternoon in a panic. I immediately went to work restoring their data from various backups. But the problem was, nobody was checking their backups to make sure they were working. It turns out only one of the backups was working and it wasn’t a disaster recovery backup. In the end I was able restore a good portion of their data, but there was still a lot lost. Had they been on a contract with backup monitoring, the amount lost would have been much less!
In my last post I introduced two business models: Break/Fix and Managed Services. Managed Services basically means that your client is outsourcing their technology department. You, the service provider, become their IT department. My client would have benefited greatly if they were signed up on a managed contract.
Here’s a breakdown of what Managed Services looks like:
Managed Services needs to be at a price point that is both good for you and the client – but, don’t price it too low! This is an investment for them, in their company, and you need to offer a great product. How can you offer a great product and service at a discounted rate? The answer is you can’t.
Think of what it will take to support their workstations, server, routers, etc. If you have worked for them before, take a look at past invoices. How much are they spending each month? Each quarter? Each year? You can get a good idea of what it will take to offer managed maintenance and support.
So, what should you charge? This can be a hard question to answer. It depends on your clientele, your market, what you want to offer and how you want to offer it (on-site? remote? both?). Here’s a good start:
Workstations and Servers:
Typically you need to charge a set fee for each workstation and server they have. Start around $10 per month per workstation (remote monitoring only) and go up from there ($25 to $50 per month or more for unlimited support). Each client will be different. $50 might not be enough for unlimited support. If they have basic workstations setup, use MS Office, email, and a web browser, $25 – $50 should cover that. If they have more complicated systems (engineers using AutoCAD or lawyers/accounts using vertical market software) you may need to raise the price.
The same thing for servers. The more complicated, the more you need to charge. Also pay mind to the age and condition of the server. For a basic file server I usually charge around $150 to $300/month. Obviously, if more complicated services are being hosted on the server (Exchange Server for example), you should charge more. How much more is up to you, your skill level, and the complexity of the extra service(s) being run. If the server is running a program you’re not comfortable supporting, carve that out of the contract and support it on a hourly basis only. Usually you would cover everything on the server, though.
With these prices in mind, you might still need to charge for on-site visits and definitely for project work. Anything being added or changed or replaced will fall under project work. Your contract with the client should only include their existing hardware and software.
The cost of new hardware or software is, of course, separate.
You can customize your offerings to your clients too. Maybe offer a basic package package – $10/month workstation monitoring and patching, $50 server monitoring and patching – no support, just monitoring. This can be the “Starter” package. After that, move up to the “Better” package – unlimited remote support, patching and monitoring. $25/month/workstation and $150/month/server. You get the idea. I highly encourage you to come with with your own pricing and packaging. What works for me might not work for you and your clients.
Hardware and Vendor Management
You can also include support for other hardware your client might have. Printers, fax machines, modems, routers, print servers, phones/phone system. Each one will also have a monthly price. Around $20 per month is a good starting point depending on the hardware and your ability to support it. You can include monthly, on-site cleaning and maintenance.
Vendor management is another item you can offer to support. If anything happens to their internet connection or phone service, you’ll take care of it – for an additional monthly fee of course.
Here’s an example of services with pricing (notice that the on-site hourly rate goes down with a contract):
|Service||Hourly Rate - |
|Monitoring Only (Basic Package)||Unlimited|
Remote Only (Better)
|Remote Maintenance and Support||$150/hr, 1 hr minimum||$100/hr, 1 hr minimum||Included||Included|
|Remote Project Work||$150/hr, 1 hr minimum||$100/hr, 1 hr minimum||$100/hr/half hr minimum||$100/hr|
|On-Site Support||$180/hr, 1 hr minimum||$130/hr, 1 hr minimum||$100/hr/1 hr minimum||Included|
|On-Site Project Work||$180/hr, 1 hr minimum||$130/hr, 1 hr minimum||$100/hr/1 hr minimum||$100/hr/1 hr minimum|
|Full Monitoring of Vital Services||-||Included||Included||Included|
|Preventative Maintenance Including Updates, Patches, and Fixes||-||Included||Included||Included|
Use this table as a template and come up with your own pricing and offerings.
The idea here is to setup an environment in which recovering from a disaster is made easier and faster. Especially if your client is signed up for unlimited support. You are in business to make money. The more time spent recovering from a disaster, the less money you make and the less happy your client becomes. Monitoring and setting up various levels of backup can greatly reduce downtime and lost money.
I’m in the process of signing up my aforementioned client on a managed contract. They see the value in this service and it’s great for both of us.
My next post will be about how to automate some of the monitoring and management using various software tools. Thanks for reading!