When a business is small, the classic Kiwi approach is to “DIY” IT. The most tech-savvy person becomes the unofficial IT help, juggling these responsibilities with their actual job. But eventually the business grows, and you need external IT support. You find a local IT provider, and they offer a pay "per-ticket" model - only charging when you need help. Sounds fair? You don’t expect to need much support, so the flexibility sounds great. Fast forward a year or two. Your team is bigger, you need support more often, and the cost per month keeps growing. Pretty soon you are wondering why you’re paying so much for basic support.

Interestingly, this issue is most common in mid-size businesses. Enterprises typically have fixed-fee support agreements, and in smaller businesses (less than 20 people) the low support needs suit per-ticket pricing. However mid-sized NZ businesses hit a tipping point where support costs increase exponentially as their size, complexity, and issues grow.

Here’s our four key strategies for mid-size businesses to reduce support costs while still getting a great service.

1. Move away from Per-ticket pricing.
When your business is small and doesn’t use a lot of IT support, per-ticket pricing makes sense. As your business scales and your volume of calls increase, being charged in 15-minute blocks for every two-minute fix gets expensive, fast. Per-ticket pricing benefits the IT provider, there is no risk to them and the financial burden is on you. Taking a long time to fix the same issues over and over actually benefits the provider.

As your volume increases, consider switching from per-ticket pricing to a fixed monthly fee. Not all providers offer this, so ask for options. A fixed fee shifts the onus to the provider to deliver services efficiently and gives you predictable costs.

2. Market test your rate card
In the enterprise space, IT rates/hour are typically competitive and regularly benchmarked. Providers find out quickly if they are overcharging compared to market. However, in the SME sector, businesses often stick with the same provider for years without reviewing their pricing. This lack of competition/constant market assessment can result in above market rates.

Take the time to review your rate card and compare it to other providers. If you have been with the same IT partner for years, check you are still getting a fair deal.

3. Eliminate repeating issues
If your provider charges per ticket, they are financially motivated to have more tickets to fix. IT companies won’t deliberately leave issues unresolved, but if fixing the root cause means fewer tickets (and less revenue), where’s their incentive? Ask yourself, are you paying for the same problems to be fixed over and over? We have seen multiple examples where slow, manual workarounds are used instead of the root cause being properly fixed.

If you see repeat issues and workarounds, it’s worth asking why. There may be a lack of expertise, a lack of attention, a lack of process, or a lack of commercial motivation.

4. Check for overlapping charges
If you have multiple services with your IT provider, check what is actually included in each service. For example, if you are paying for monthly security services, what happens when you face a security event? Is the fix covered by the monthly security services fee - or does it get charged as a service desk ticket? You may find you are being charged in the monthly fee and as a service desk ticket. This can easily be missed by providers and your business.

Having clear service inclusions and checking the detail can help ensure you’re not being double charged.

As your business grows, so does your IT support need - but your costs shouldn’t spiral out of control. By reviewing the pricing model, benchmarking rates, eliminating recurring issues, and clarifying charges, you can reduce IT costs while getting better service.

A great IT partner should be focused on delivering real value, not just billing you for every little fix. If your IT costs keep climbing without clear improvements, it may be time to reassess your provider.

If you need help, check out our Technology Advisory services or send us a chat anytime.