How much should I charge for IT Support?

[Calx]

Hi everyone I am a newbie here, so I hope this is the right place to put this question!
I am a self employed Computer Fixer/teacher (based near Birmingham) supporting small businesses and home users. I charge an hourly rate for IT support and fixed price fixes for removing viruses etc.
A couple of my small businesses have asked if I would offer a support contract to take care of there websites, IT requirements, and other general IT related queries.
I would like some advice please on whether:
a) this is a good idea?
b) how much should I charge a month, to cover their needs and for me to still earn a decent wage?
c) How do you stop clients taking advantage? ie. asking for hours and hours of help and me ending up out of pocket. At least by the hour payment I get paid for what I do.
I only work school hours as I have young children and I don't have nor want to use child care during holidays.

Any advice would be really gratefully received, thank you.

 

[Clouvider]

Hi
It is beneficial to you as you have a recurring, contract customer.

I would say it is good to define the amount of hours of support included in contract, so you can charge them extra if they go over. Or you can include a clause of fair usage to protect yourself.

You should definitely include the hours when the support will be available to not end up working the hours you cannot do.

Dominic

 

[Tim @ T J Dixon Limited]

I agree with Dominic.

Clients want the ease of a regular contract, and you benefit from the regular secured work.

My advice would be to define the number of hours included, hours you are available and a response time. The clients may be expecting a prompt response. It is normal to say that they will get priority over adhoc support calls, but you will have times when you can't support them as quickly as they would like.

Including monthly checks for virus updates, windows updates etc shows value when you are not called upon.

In terms of how much - I have heard companies offering it based on around £15 a machine per month on the cheap end of the scale. You need to work out what would be included in these costs and cost it accordingly.

Tim

 

[Calx]

Thank you Dominic and Tim,
I should add at this point the business in question is a hairdressers, with 1 laptop, a website that I designed and a facebook page. So I would have to charge more than £15/month, that wouldn't even cover a call out. I just can't see how I would make a profit? I am so "small scale" :/

 

[Clouvider]

Calx, have you though about doing some of the tasks remotely?

I think you should check your local competitors, if you are doing a local service.

 

[mzone]

So I would have to charge more than £15/month, that wouldn't even cover a call out.

We charge ours customers £40 ph on the side support, for remote support it`s about £20-25 ph, depends what we do.

I think £20 ph at local services is a good price.

 

[Calx]

Calx, have you though about doing some of the tasks remotely?

I think you should check your local competitors, if you are doing a local service.

I have thought about it Clouvider perhaps using the free version of teamviewer but again I don't know how you would charge for such a service? By the minute or so many minutes for a monthly fee? I've been quite comfortable just going out to the customers for so long I am nervous of changing my practises, especially into technology that I am not familiar with!

 

[Clouvider]

Using free version of TeamViewer would be a violation of the software license if used for business, no matter how small. There are other, free solutions that you could use though. By that you can expand the range of your service (so scale) and maybe overcome the problem of being available after school hours (for example delivering remote support only say 'after regular hours but until 6pm'.

I think that the best bet would be to have a look at your local competitors, is there any business, computer store, that does same service ? What are their prices? What's included in their offer ? It is worth checking, not to copy it, but if you say too much you may loose the customer to the competitor(s), if you say too less it may be not enough for you to pay the bills.

You may also ask your customers how many hours they would expect to contract, and you can give them your usual rate multiplied by the amount of hours they want to have included, minus some discount so they are happy of being in a contract. As an added benefit you could perhaps offer them to calculate the average use of support, so if they use more in March and less in April you will not charge them extra.

 

[Calx]

Using free version of TeamViewer would be a violation of the software license if used for business, no matter how small. There are other, free solutions that you could use though.

Is there one you would recommend? I've only used Teamviewer to remote support my Mum!

Your responses have been helpful. thank you

 

[Tim @ T J Dixon Limited]

Another option to put on the table.

Charge the client a retainer fee including 1 hour of support per month (say £50) - additional hours are at a slightly lower rate to your normal charge. This gives you a constant income and value for the client.

You should charge at minimum of 15 minute intervals, if not 30 minutes to make it worth your time.

 

[Clouvider]

@Calx, you can use for example VNC with some VPN solution.

 

[Calx]

@Calx, you can use for example VNC with some VPN solution.

OK @Clouvider but I'm not up to speed on these things. Can you recommend a good resource on the net for me to do a little reading up on please?

 

[Clouvider]

For example this resource: http://lifehacker.com/228862/geek-to-live--secure-vnc-with-hamachi.

If you need any help please feel free to contact me, I will try to help you out.

If you have access to two computers (even on the same network) it would be good to try it out before deploying at the customer's system.

 

[KM-Tiger]

c) How do you stop clients taking advantage? ie. asking for hours and hours of help and me ending up out of pocket.

You have to define what you will and will not support.

For example if they do not have AV installed, then you charge them for doing that as a pre-contract extra. Likewise if there are months (years!) of updates to do then again charge as a pre-contract extra.

Once things are in reasonable shape then the contract can start, but expect to do more in the first 3 months than you will do in the next 9 months. That's the principal reason such contracts are usually of minimum one year duration. You take the profit at the end of the term.

Beyond that don't be afraid to charge for any work that falls outside of the contract. It's very easy to slip into the habit of 'going the extra mile' for a client when you should be charging them. You just have to get into the habit of saying "yes I can do that, I'll quote you a price". I've never known any say no if it's something they want.

 

[Employment Law Clinic]

Thank you Dominic and Tim,
I should add at this point the business in question is a hairdressers, with 1 laptop, a website that I designed and a facebook page. So I would have to charge more than £15/month, that wouldn't even cover a call out. I just can't see how I would make a profit? I am so "small scale" :/

Why would you need to cover a call out for the website or facebook page? And why would you need to cover that charge every month - are they going to have that many issues with such limited IT?

I charge retainer clients based on my hourly fees with a reduction for the retainer (although this can be cancelled at anytime), with an estimate of the work necessary for advice & support as & when needed - i.e. perhaps 50% of what I would charge on an ad hoc basis. I get paid even when there is no work to do in a month, but this pays for the time when there is work to do.

In your case, one laptop is hardly going to require a lot of attention, so X amount a month will sometimes be paid for nothing, but will be balanced out when you do need to something: £15 might not cover a call-out, but a call-out even every 4 months would be excessive - would £60 cover a call-out?

This should be covered in your business plan - you won't make much of a profit from one client, with one laptop & a small online presence, but then you won't have much work to do for them either.


Karl Limpert

 

[Calx]

@Employment Law Clinic I can imagine that they will be on the phone frequently asking me to upload photos on their behalf which I will have to call out to do because they don't know how to email them over to me. I also think I will get phone calls when they have any kind of technology issue - Like I have forgotten my password, or any kind of pop up about windows updates.

I don't have a business plan, I've no idea what to include. I just charge by the hour, and add on a couple quid if I make any sales of equipment. Is that bad?

 

[Employment Law Clinic]

@Employment Law Clinic I can imagine that they will be on the phone frequently asking me to upload photos on their behalf which I will have to call out to do because they don't know how to email them over to me. I also think I will get phone calls when they have any kind of technology issue - Like I have forgotten my password, or any kind of pop up about windows updates.

I don't have a business plan, I've no idea what to include. I just charge by the hour, and add on a couple quid if I make any sales of equipment. Is that bad?

I would be inclined to estimate the average monthly activity, make a reasonable (but practical) adjustment for the retainer feature (I charge more an hour than I imagine you would (£150), so I can offer a large % reduction), and quote on that basis. Some months you should be paid for more hours than you work for, others less, but it should equal out if you've planned (estimated) efficiently.

Is it bad not to have a plan? What do you do in the morning when you arrive at your desk? If you're sitting there waiting for calls or emails to come in, with nothing constructive to fill the time, that's probably bad. Planning how you're going to make this enterprise a success is probably a better approach.



Karl Limpert

 

[Calx]

Is it bad not to have a plan? What do you do in the morning when you arrive at your desk? If you're sitting there waiting for calls or emails to come in, with nothing constructive to fill the time, that's probably bad. Planning how you're going to make this enterprise a success is probably a better approach.

TBH if I don't have any call outs then I catch up on housework (the joy of working from home)... I don't have set hours other than I work while the kids are at school and in the evenings when DH gets in from work! Structure... smucture... hmmmm maybe I need to have a plan.

 

[Employment Law Clinic]

c) How do you stop clients taking advantage? ie. asking for hours and hours of help and me ending up out of pocket. At least by the hour payment I get paid for what I do.

Well, I personally don't stop clients asking for hours and hours of help, and if they did, I would cancel their contract: the retainer I offer (which is very different to some competitors that insist on five year terms (or as a minimum for some of the more scrupulous ones, one year) is that they can cancel the contract at any time. But so can I, so if they abused the service, the monthly fees would increase dramatically, or they'd be dropped as a client (although this is feasible, it's never happened).

In practice, I get paid monthly often without hearing from a client for months on end. When an issue arises though, I'll have to offer a lot more time in a short period than that month's retainer covers, but it either has been or will be paid for.

And when a comprehensive service is provided promptly, the client remembers that more than the fact they paid for months without receiving (needing) any assistance at all.


I work from home, am a single parent to a one year old, and I have structure to my day: I get up, get coffee, read emails and perhaps forums, get more coffee, read more, get him up & to nursery, and then get into the day - have more coffee, reply to emails & forums, assist clients, and if I have nothing to do, find a way (any way) of getting the business out there, anything to get more clients.


Housework is personal time nobody pays you for (unless you're my cleaner). If you have unfilled hours in the working day, they should be used to fill your client book, get the work in.


Karl Limpert

 

[lyonsdown]

I've been providing IT support for Macs and PCs for 15 years. I charge £80 an hour (for any part of first hour), and £40 a half hour if it goes over the first hour.
I've rarely had any problems on price, even with home users, though any marketing person will tell you that in any market 20% of customers are looking for the cheapest price.
My question is: how much do you pay for a plumber or electrician ? answer: at least what I charge. I have a lot of knowledge, so why should I charge less than a plumber?
On a contract, I start at £40 a month per machine, with a maximum of 3 hours per machine per month. After that they pay £55 an hour (ie.less than my ad hoc rate). That has also worked well.

 

[Calx]

I've been providing IT support for Macs and PCs for 15 years. I charge £80 an hour (for any part of first hour), and £40 a half hour if it goes over the first hour.
I've rarely had any problems on price, even with home users, though any marketing person will tell you that in any market 20% of customers are looking for the cheapest price.
My question is: how much do you pay for a plumber or electrician ? answer: at least what I charge. I have a lot of knowledge, so why should I charge less than a plumber?
On a contract, I start at £40 a month per machine, with a maximum of 3 hours per machine per month. After that they pay £55 an hour (ie.less than my ad hoc rate). That has also worked well.

I charge £30/hr and some folk round here moan that is too much. I haven't put my charges up in 5 years. Do you get many people say too much and go elsewhere?

 

[Faevilangel]

I know a bloke through networking who does well offering a remote only support service for small businesses, he charges £9.99 a month per PC for unlimited support (he does have a fair usage policy but not aware what it is).

He now has a few hundred clients including some huge brands in the UK and he never has to leave his office.

Find out what your clients want, do they want you in their office to fix their issues or do they want you to login and do the regular maintenance?

We could all say charge £40 a month and offer 3 hours but until you understand your clients needs then you won't be able to offer the ideal solution.

 

[Alan]

I agree with @lyonsdown , it is crazy that some people think they should pay less (or earn less) than plumber, or car mechanic or similar for skilled IT work.

It is very difficult to work out a retainer rate unless you hav elots of historical data relating to 'average' client requirements. That means having clients and tracking the time spent, this is all data you have to gather.

I really have a gut feeling that your client that wants to go on a monthly contract wants to do it to take advantage of you. I would stick with charging by the hour and track your time carefully until you have enough real data across multiple clients.

 

[bgravenell]

A large number of IT companies will bespoke their costs based upon individual customer requirements,

 

[Darren Street]

It really beats me how small support companies make any money at all these days. The expectations are so high and of course the problems are never the fault of the owner.

£50 /h seems reasonable to me once you have factored in the transport and muckeration costs and weekend phonecalls.

 

[The IT Dept]

@Employment Law Clinic I can imagine that they will be on the phone frequently asking me to upload photos on their behalf which I will have to call out to do because they don't know how to email them over to me. I also think I will get phone calls when they have any kind of technology issue - Like I have forgotten my password, or any kind of pop up about windows updates.

I don't have a business plan, I've no idea what to include. I just charge by the hour, and add on a couple quid if I make any sales of equipment. Is that bad?

Hi Calx,

I'd offer them X hours, (or part hours), per month at Y cost. Additional time at a slightly higher cost, as the regular and guaranteed work is worth more to you and to be encouraged. e.g. £45.00 per hour for "contracted" hours, £55.00 per hour for additional work. £10 per quarter hour for any remote support work over and above the contracted hour(s).

You then need to create a Job Card for every piece of work that you do for them, showing how much time each job took.

Charge them every time they use you, otherwise they get used to not being charged and resentful when you do charge.

Adding a percentage mark-up (10 or 15% is usual) to equipment sales is to cover your expenses in sourcing and obtaining the correct hardware, plus the hassle factor for any that needs to be returned.

Get the right prices sorted in your own mind as, if you are successful, they may refer you to other clients and their first question will be the cost. Be confident and state your costs. Anyone who wants you cheaper may not be worth supporting. In my experience the clients that want to pay the least, want the most!

Good luck.

 

[Calx]

Hi Calx,

I'd offer them X hours, (or part hours), per month at Y cost. Additional time at a slightly higher cost, as the regular and guaranteed work is worth more to you and to be encouraged. e.g. £45.00 per hour for "contracted" hours, £55.00 per hour for additional work. £10 per quarter hour for any remote support work over and above the contracted hour(s).

You then need to create a Job Card for every piece of work that you do for them, showing how much time each job took.

Charge them every time they use you, otherwise they get used to not being charged and resentful when you do charge.

Adding a percentage mark-up (10 or 15% is usual) to equipment sales is to cover your expenses in sourcing and obtaining the correct hardware, plus the hassle factor for any that needs to be returned.

Get the right prices sorted in your own mind as, if you are successful, they may refer you to other clients and their first question will be the cost. Be confident and state your costs. Anyone who wants you cheaper may not be worth supporting. In my experience the clients that want to pay the least, want the most!

Good luck.

I read this and think I am so undercharging... The job card idea sounds sensible. Will start that as already had 3 phone calls today helping them set up "ordering" their b'band!