The Rising Cost of IT Services: Tips for Small Businesses to Save Money

IT auditing made simple

Most small businesses with less than one hundred users have a remarkably similar IT profile, and their ongoing costs consist of the following:

• Microsoft 365 subscriptions
• Microsoft Azure subscriptions
• Application software subscriptions
• Support costs (helpdesk)
• Managed Security Services (AV/EDR, Mail/Web Protection, Patch Management)
• Data backup
• Connectivity

Exercise for an independent party to determine whether a small business is receiving far value. For example, conventional support models are tied to headcount or the number of devices, whereas a growing band of MSPs is using a fairer consumption-based model. This means that if your business places low volumes of tickets, switching to a " pay as you use " based model could generate significant savings.

Further savings can be unlocked by undertaking these steps:

• Further savings can be unlocked by undertaking these steps:
• Ensuring that your Microsoft subscriptions are optimised
• Identifying and removing duplicated cloud services - i.e. shadow computing
• Review your internet connectivity to ensure that you are subscribed to the most competitive deal
• Reviewing your data backup strategy

Most conventional support cost models pin the cost to the number of users or endpoints, which means businesses could be paying more than necessary.Unlike our peers who charge on a per-user basis, we calculate premiums based on your actual usage. We use a cost calculator to determine your premium (and we share that with you). The result is you only pay for what you consume. Why should a 50-seat company pay any more for their support if they log the same number of calls as a company with half as many users? We think that’s unfair.

Here's an example:

CONVENTIONAL MODEL (tied to users or endpoints) 50 users/endpoints @ £20.00 per month = £ 12,000.00 per year

OUR MODEL (tied to call volume) Average monthly call volume for 50 users @ 18 calls per month = £7800.00 per year

Mothball assets that are not in service

Any endpoint that is operational consumes monthly costs for managed security services such as web protection, anti-virus, patch management, and monitoring. By regularly performing housekeeping tasks, you can remove unused assets and enjoy ongoing savings. Many small businesses do not have the time or scope to focus on such tasks, and the result is their estate becomes bloated, and they end up paying for redundant assets. At FOS.net, as standard, we provide regular audits to handle such admin and housekeeping tasks. This means that we flag and remove redundant assets.

Keep on top of your Microsoft 365 billing

If you’re on month-to-month billing, some plans like 365 Business Basic and Premium have increased by 20%. When was the last time you checked your bill to make sure you’re only paying for what you need? You can find reports in the 365 admin portal to see if users are on the wrong plans or using unnecessary licenses. However, many small businesses don’t do this and end up paying for extra licenses. Our managed 365 billing service regularly audits your account to ensure you’re only paying for what you actually need.

Locate users who are over-licensed

Microsoft 365 licenses come in different tiers, commonly Business Basic, Standard, or Premium for small businesses. Some users may also have an unnecessary Exchange Online plan, as it’s already included in all three Business Plans. Additionally, not all users need the extra features of the Premium license, so only assign higher-tier licenses to those who truly need them.

Convert leavers to shared mailboxes

Changing a mailbox to shared is useful when others need to manage the work of a former employee. For instance, a sales manager can follow up on a departing rep’s customer tasks. A shared mailbox doesn’t need an Exchange Online license unless it’s over 50 GB or has an archive. Administrators can easily switch it back to a regular mailbox if needed.

Monthly billing

If you’re on month-to-month billing, some plans like 365 Business Basic and Premium have increased by 20%. For a stable or growing business, switching to an annual agreement is more cost-effective. However, for seasonal or part-time staff, this may not work, but you can mix both annual and monthly plans as needed.

Eliminate Shadow Computing

Many small business owners let staff use third-party software without proper oversight, leading to unnecessary costs. Most of the time, employees aren’t acting maliciously; they’re just trying to improve their work. Before using new software, check if the needed function is already available.

Here are some steps to follow:

• Review your software – take an inventory
• Evaluate and prioritize risks
• Secure systems
• Create policies
• Educate staff and monitor

These steps help reduce risks and save costs. Shadow IT happens when employees are unhappy with current IT solutions. Instead of fighting it directly, find out why they’re bypassing IT, then address the root cause.

Connectivity

Keep track of when your contract end dates. A few months prior to the end date, reach out to the market to benchmark your deal. You could get more bandwidth for the same price or negotiate a price reduction. FOS.net access to the UK wholesale market via our strategic partnerships. We undertake market intelligence and take care of the entire process.

Review your data backup costs

Small businesses can reduce their data backup costs by implementing a few simple strategies.

Prioritize What Needs to Be Backed Up

Backing up everything increases storage costs. Identify essential data—such as financial records, customer information, and project files—and only back up the necessary files. Non-essential data can either be excluded or backed up less frequently.

Use Local Backup for Non-Critical Data

Consider hybrid backup solutions—store non-critical data locally on external hard drives or network-attached storage (NAS) devices while using cloud backups for critical data. This helps reduce reliance on cloud storage and lowers costs.

Review and Delete Old Backups

Regularly review old backups and remove outdated or redundant data. Reducing the volume of stored backups can significantly cut down on cloud or server storage expenses.

Conclusion

Technology is advancing quickly, making it essential for your IT systems to be optimized to improve your business processes and stay competitive. However, many small businesses only review their IT partnerships when they experience poor service or notice a sharp rise in costs. While change can feel overwhelming and it’s often hard to know where to begin, independent audits and benchmarking can help.

These tools give you valuable insights, helping you make informed decisions about potential improvements to your IT setup before issues arise. This proactive approach ensures your business runs efficiently and stays ahead in a rapidly evolving market.