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Updated Oct 27, 2023

Pros and Cons of an IT Managed Service Provider for a Small Business

Organizations with no IT staff, or that want personnel to be free for other duties, can turn to managed services to monitor their IT infrastructure.

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Written By: Adam UzialkoBusiness Strategy Insider and Senior Editor
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This guide was reviewed by a Business News Daily editor to ensure it provides comprehensive and accurate information to aid your buying decision.

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Your employees can’t work if your technology isn’t working. Many small businesses hire a dedicated IT manager, but that’s not always the best answer. Managed service providers (MSPs) are an increasingly popular option for small businesses. 

Considering outsourcing your IT tasks? Here’s everything you should know about MSPs.

What are managed services?

Managed services are available for small businesses looking into outsourcing options for their IT needs. Managed service providers support your company’s technology for a monthly flat fee. They proactively monitor a business’s network, minimize IT problems, and troubleshoot any issues that come up on the network. 

With advancements in cloud computing, most IT work is available for outsourcing. The managed service provider remotely accesses networks and deploys solutions for any computing issues without being in-house.

Managed service providers present contracts to clients to detail what services they include. Contracts also list service start and end dates. Outsourcing solutions available through vendors could include:

Most managed service providers promote all-inclusive packages with unlimited IT resources while hired, including day-to-day network management.

When looking at MSPs, ensure they're familiar with the regulations your business must follow, which may include the California Consumer Privacy Act (CCPA) and PCI compliance.

Why does a business need managed IT services?

Businesses need managed service providers because they negate risks. Instead of outsourcing IT when a problem occurs, managed services allow consistent network monitoring. Also, a managed service provider handles all updating and maintenance tasks. This allows managers to focus on their businesses instead of worrying about the company’s IT functionality. 

A prospective managed service provider should also evaluate current and future IT needs. The MSP advises on what products and services a business should implement over the next year.

Consider online tech support if your tech needs aren't extensive and your budget can't accommodate an MSP. Online tech support services can provide immediate IT help remotely.

Pros and cons of MSPs

MSPs differ from other tech-upkeep methods because they’re designed to support and centralize many facets of IT for a small business. For example, an MSP can handle your company’s networking, help desk queries, server upkeep, project management, and desktop support. 

MSPs support many clients – more than a computer store or independent professional would handle. They have more resources at their disposal and a deeper knowledge base to draw from.

However, small businesses should consider several factors before subscribing to an MSP. For example, does an MSP fit in your budget? Do you need someone on-site who can fix problems like printer jams? Are you sure your technology is secure? 

Benefits of using an MSP include the following: 

  1. An MSP is a proactive solution. If an MSP operates effectively, it should prevent technical issues from occurring. It constantly monitors IT elements like hardware, applications, security, technology trends, and the internet and notifies you when there’s an issue or abnormality. The MSP may recommend that you upgrade technology to boost productivity. Ultimately, you’re paying for someone to keep your business from having issues instead of fixing them.
  2. An MSP may provide technology. With certain plans, the MSP provides all the technology for your business, such as workstations, servers, and software. While this service is expensive, it means you won’t have capital expenditures for the technology, allowing your business to focus its capital in other areas, which is always beneficial.
  3. MSPs provide tech expertise. If a business uses one computer person for all things IT, chances are they’re not an expert in all areas. They may be good at troubleshooting Microsoft Word, but what happens when your router stops functioning? In contrast, MSPs usually have skilled personnel dedicated to every IT function. This usually means they’re better equipped all around.
  4. MSPs offer business continuity. As a business owner, do you ponder how you would go about restoring all your systems and data in the event of a disaster? If not, you should. This is an area where an MSP can help you tremendously. A good MSP can create an efficient disaster recovery plan that will help you sleep at night, knowing that if disaster strikes, your business can endure it. This is particularly important as cybersecurity risks, such as ransomware attacks, become more prevalent. 

Downsides of using an MSP include the following: 

  1. MSPs don’t provide a physical presence. A huge downside to MSPs is that many are not local to your business. When an issue like a printer malfunction comes up, you may need to get involved, as many MSPs manage your technology remotely. If you choose a local MSP (at least within your state), it may offer on-site support, but you’ll usually have to pay extra for a physical office visit.
  2. MSPs can be expensive. A reputable MSP is expensive. You’ll likely pay upfront fees and at least a few hundred dollars in monthly costs, depending on your business’s size and technical needs. However, remember to factor in what an MSP will save you in other areas. For example, it may provide technology you won’t have to purchase.
  3. An MSP’s scope may not cover specific areas. An MSP’s scope of work almost never covers every single area of technology. An MSP will typically provide you with a list of applications it supports (Microsoft Office, Google Chrome, etc.). You’re likely out of luck when you call about an issue with third-party software that’s not on its supported list or in the contract.
Did You Know?Did you know
An MSP can help you choose the best tech solutions for your business by researching vendors, testing options, and evaluating security measures.

Deciding if you need an MSP

Small business owners must weigh several factors when deciding to work with an MSP. For some, an MSP’s costs may be prohibitive. Similarly, bringing on an MSP may be unnecessary if the business already has a fleshed-out IT team. 

However, if you find your business frequently leaning on IT support or you’re spending too much time trying to fix technical issues yourself, an MSP may be an ideal solution.

Jeremy Bender contributed to the reporting and writing in this article. 

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Written By: Adam UzialkoBusiness Strategy Insider and Senior Editor
Adam Uzialko, senior editor of Business News Daily, is not just a professional writer and editor — he’s also an entrepreneur who knows firsthand what it’s like building a business from scratch. His experience as co-founder and managing editor of a digital marketing company imbues his work at Business News Daily with a perspective grounded in the realities of running a small business. Since 2015, Adam has reviewed hundreds of small business products and services, including contact center solutions, email marketing software and text message marketing software. Adam uses the products, interviews users and talks directly to the companies that make the products and services he covers. He specializes in digital marketing topics, with a focus on content marketing, editorial strategy and managing a team.
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