Fast-growing managed service providers (MSPs) tend to charge more for their services, global research into the pricing habits of nearly 400 firms has found.
The research, carried out by IT systems management vendor Kaseya, quizzed 386 MSPs – 255 in North America, 76 in EMEA and 55 in Asia-Pac.
High-growth MSPs – those enjoying average annual recurring revenue growth of 10 per cent or more over the past three years – were found to charge significantly more for their technicians and support packages.
Asked to disclose the hourly rate they most frequently quote for their level 1, 2 and 3 technicians, the average among high-growth MSPs stood at $94 (£65), $105 and $121, respectively. The corresponding rates for low-growth MSPs questioned were much lower, at $81, $82 and $101.
Similarly, some 37 per cent of high-growth MSPs said they charge more than $200 on average for ongoing server support and maintenance per month per device. But this was true of just 16 per cent for MSPs outside the high-growth category.
"We see a swirl of statistics pointing to the same conclusion: if you want sustained growth, you have to plan for it and work towards it, step by step," Kaseya said in the report. "For example, high-growth MSPs charge more for their technicians; have a higher variance between what they charge for level 1, 2 and 3 technicians; charge more on average for ongoing server support and maintenance per month; and have a higher average size monthly managed services contract."
The research also suggested EMEA-based MSPs are charging on average less for their services than their North American or Asia-Pac counterparts.
Some 34 per cent of Asia-Pac and 31 per cent of North American MSPs charge over $200 on average for ongoing server support and maintenance per month per device, the survey found. The corresponding figure for EMEA-based MSPs was just 13 per cent, with 37 per cent in our region charging $125 or less, compared with 19 and 21 per cent in Asia-Pac and North America, respectively.
Some 28 per cent of all MSPs questioned said they used a cost-based model, 51 per cent used a value-based model and 21 per cent employed a price match model.
More than 50 per cent of respondents said they offer cloud, the uptake of which Kaseya also found is linked to higher growth.
"High-growth MSPs are much more likely to offer new 'emerging' services versus their lower-growth counterparts, which further embeds them in their clients' businesses," it said. "For example, high-growth MSPs are over twice as likely to offer cloud monitoring services than their peers."
UK chief executive Cindy Rose says the proposed deal is needed to maintain the 'free flow' of data
Contingency plans follow Carillion's demise earlier this year
iboss EMEA VP tells CRN that he sees no point in the vendor entering into competition with its partners
Oliver Tuszik says partners can boost subscription sales by taking a customer experience-led approach