MSP vs In-House IT Comparison Guide

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You’ve got a decision to make.

Your business has grown. IT issues are eating up more time. That one person who “knows computers” is getting overwhelmed. Something needs to change.

The question is: Do you hire an in-house IT person, or outsource to a Managed Service Provider (MSP)?

It’s not as simple as comparing salaries to monthly fees. There are hidden costs on both sides, and the “right” answer depends entirely on your business.

Let’s break it down honestly.

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The Real Cost of In-House IT

When most people think “in-house IT,” they think of a salary. But that’s just the beginning.

The Visible Costs

• IT Support Technician salary: £28,000 – £40,000/year
• IT Manager salary: £45,000 – £65,000/year
• Employer’s NI contributions: ~13.8% on top
• Pension contributions: 3-5% minimum
• Recruitment costs: £3,000 – £8,000 per hire

A £35,000 IT technician actually costs you £42,000-£45,000 when you factor in NI, pension, and benefits.

The Hidden Costs

Here’s what catches people out:

Training & Certifications

Technology changes constantly. Microsoft, Cisco, and security certifications need renewing. Budget £2,000-£5,000 per year to keep skills current.

Tools & Software

Your IT person needs tools: remote management software, security tools, monitoring systems, and ticketing software. That’s £200-£500/month you might not have considered.

Cover & Redundancy

What happens when your IT person is on holiday? Or sick? Or leaves? You’ve got a single point of failure. Either you pay for backup cover, or you accept periods with no support.

Knowledge Gaps

One person can’t know everything. Networking, security, cloud, software development, phones, etc., it’s too much. You’ll still need external help for specialist work.

Realistic In-House IT Cost

For a competent IT support person with proper tools and training:

• Salary + NI + Pension: £42,000
• Training & certs: £3,000
• Tools & software: £4,000
• Recruitment (amortised): £1,500
• External specialist help: £5,000
• Total: £55,500/year

And that’s for ONE person covering maybe 30-50 users – with no redundancy.

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The Real Cost of an MSP

Managed Service Providers typically charge per user, per month. But what do you actually get?

Typical MSP Pricing (UK)

• Basic (reactive): £30-50/user/month → £10,800-£18,000/year for 30 users
• Standard (proactive): £50-80/user/month → £18,000-£28,800/year for 30 users
• Comprehensive: £80-120/user/month → £28,800-£43,200/year for 30 users

For a 30-user business, comprehensive managed IT typically costs £30,000-£40,000/year.

What’s Usually Included

A decent MSP should provide:

• Unlimited helpdesk support – calls, emails, remote fixes
• Proactive monitoring – catching problems before you notice
• Patching & updates – security patches applied automatically
• Backup management – monitoring and testing
• Security basics – antivirus, email filtering, MFA setup
• Vendor management – dealing with Microsoft, ISPs, suppliers
• Strategic advice – planning, budgeting, roadmaps
• Multiple engineers – no single point of failure
• Out-of-hours cover – emergencies don’t wait for 9am

What’s Usually Extra

Watch out for these common add-ons:

• Project work (migrations, new setups)
• Hardware procurement (though some include it)
• Cybersecurity extras (advanced threat protection, SOC)
• On-site visits beyond a certain number
• Line of business application support

Ask what’s included before you sign anything.

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Head-to-Head Comparison

Let’s compare like-for-like for a 30-user business:

• Annual cost: In-House £55,000+ vs MSP £30,000-40,000
• Expertise breadth: In-House limited to one person vs MSP team with varied skills
• Availability: In-House 37.5 hrs/week minus holidays vs MSP 8am-6pm + emergency cover
• Scalability: In-House need to hire more vs MSP scales with user count
• Redundancy: In-House single point of failure vs MSP multiple engineers
• Response time: In-House immediate (if available) vs MSP SLA-dependent (usually <1hr)
• Company knowledge: In-House deep over time vs MSP builds over time
• Physical presence: In-House always on-site vs MSP mostly remote, scheduled onsite

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When In-House IT Makes Sense

Despite the costs, in-house IT is sometimes the right call:

You Need Constant Physical Presence

If you have complex on-site infrastructure that needs daily hands-on attention – manufacturing floors, labs, warehouses with constant equipment changes, a permanent presence might be essential.

You Have Highly Specialised Systems

Running bespoke software or unusual equipment that requires deep, specific knowledge? An in-house specialist who lives and breathes your systems might be more effective.

You’re Large Enough for a Team

Once you hit 120+ users, a hybrid model often makes sense: internal IT manager plus MSP support. The manager provides company knowledge and strategic direction; the MSP provides depth and coverage.

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When an MSP Makes Sense

For most SMBs (20-100 staff), an MSP is the smarter choice:

• You want predictable costs – A fixed monthly fee means no surprises
• You can’t afford gaps in cover – Someone is always available, no panicking when Dave’s on holiday
• You need broad expertise – Modern IT spans cloud, security, networking, and compliance. An MSP brings a team.
• You want proactive, not reactive – Good MSPs prevent problems. In-house IT often becomes firefighting.
• You’d rather focus on your business – Hiring, managing, and training IT staff takes time. An MSP handles all of that.

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The Hybrid Approach

Many growing businesses land on a middle ground:

Option 1: IT Coordinator + MSP

Hire someone junior (£25-30k) to handle day-to-day queries, user onboarding, and vendor coordination. The MSP handles technical support, security, and strategy.

Option 2: IT Manager + MSP

Hire a senior IT person to own the strategy and be the internal face of IT. The MSP provides helpdesk, monitoring, and specialist skills.

This gives you the best of both worlds – internal presence and understanding, plus external expertise and coverage.

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Making the Decision

Choose In-House IT if:

• You have 100+ users AND can afford a team (not just one person)
• You have highly specialised systems requiring dedicated expertise
• Physical presence is genuinely critical daily

Choose an MSP if:

• You have 20-100 users
• You want predictable costs and coverage beyond 9-5
• You need broad expertise without hiring multiple people
• You’d rather not deal with IT recruitment and retention

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The Bottom Line

For most UK SMBs with 20-100 staff, an MSP delivers better value than a single in-house IT hire.

You get more expertise for less money, better coverage and redundancy, predictable costs, strategic input included, and no recruitment headaches.

The in-house route makes sense at scale (100+ users with a proper team) or for very specific requirements. But for the typical growing business? The maths favours outsourcing.

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Ready to Compare Options?

If you’re weighing up your IT support options, we’re happy to give you a straight answer.

Book a 20-minute call. We’ll assess your situation, give you a realistic cost comparison, and tell you honestly whether we’re the right fit – or if you’d be better off hiring internally.

No sales pitch. No pressure. Just clarity.

Book a 20-Minute Call → https://magnetarit.co.uk/contact/