A startup should be commited with support 24/7? How much to charge?


At our startup we have a software on premise business. We offer a system, for about 20k.

The client needs support for the system for 3 years, that includes to fix it if it fails no matter how many hours do we spend fixing it. We think is unlikely to fail but it can fail, we think the system could fail about 24 hours per year being negative.

We say we charge 8,1K for this support for the 3 years on office hours. ¿What do you think?

The clients says it wants the support 24x7. ¿Do you think we should do this? With this background how much would you charge?

Thank you for all your advices.

Pricing Support

asked Jan 28 '12 at 03:23
Ricardo Polo
111 points

2 Answers


First you should research some of the standard terms and conditions in support contracts. For example 24/7 365 support could mean "we will arrive at your office within 4 hours of being called to begin working on the problem" which would be much different from "if the system goes down and we have not gotten it back up within 4 hours we will credit you $100 per hour for every hour over 4 until the system is restored to service" The former is basically "best efforts" while the latter is a performance guarantee. The former really doesn't really mean all that much because you could have someone on-site within 2 hours and then take 8 weeks to fix the problem, probably not what the customer wants. On the other hand you probably don't want the later simply because problems may occur which are beyond your (or the customer's) control, such as a bug in a third party software library that you used and which you would be dependent on the vendor to fix.

As you can see, these two options should be priced quite differently as the risk, and potential costs, to you are quite different. If priced appropriately, either might be a reasonable option. It really depends on the importance of the system to the client. For example suppose your application was a payroll system for a company with 10,000 employees and if they are late with payroll it could cost them lots of money as well as lots of disgruntled employees; they should be willing to pay big bucks to support that system. On the other hand if the system is an internal website for the annual company picnic...

You need to sit down with the client and determine the appropriate level of support, consequences of an outage, and an appropriate service level agreement to meet their needs and yours. Then work out a fair price.

answered Jan 28 '12 at 04:08
Jonny Boats
4,848 points


The answer to that question depends very heavily on the costs associated with support.

If you have only 1 client and this client basically keeps you on the phone for support 24x7 then that's one cost structure. If he wants support 24x7 but your cost increase over business hours support is 5% then that's another cost structure. If this client is the only one that needs 24x7 support then you might just hire a couple of people to do this and have them being paid by the client.

In all of these cases do your cost analysis first and then the numbers will come. Asking whether or not 8100 is a reasonable number is not answerable given the context you have provided.

answered Jan 28 '12 at 03:44
1,779 points

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