Flaws in Business Plans of Remote IT Department?

Anonymous Tech Support asks: "I work for a small technical support company that is hired by local companies to manage networks, fix computers, and be the IT department in general. Last week I was working on a small network of 25+ computers. After a week of emotion and annoyances (long story), I have to ask the Slashdot community: How many of you are employees of small 'outsourced IT departments?' How much does your company charge per hour and how much do you make per hour? What sort of agreements do you have with your employer (non-compete etc.)?" The company charges $65 per hour to regular clients and I make very little of that. It seems like the business model is faulty, pushing us low-level yet skilled employees to start a company and go-it alone. It also seems like outsourced IT departments cannot have employees that will not leave or be disgruntled unless they are either a) paid enough or b) given a stake in the company. Do any of you have experience in this? What sort of business models exist out there for the remote IT department?"

Comments

Re:SoHo rates

[Shadow99_1]

Having been in the small time consulting bussiness myself (also on the East Coast, I live in PA) and I can say that it's not nearly as easy as it sounds...

Why you ask? See it's all in the contacts, and the fact that if he leaves now (when he now has contacts at client companies) he's screwed. The company he has worked for will do whatever it takes to bury him before he can gain any clients of theirs he's dealt with. And if (and is most likely the case) he had no client contacts before taking that job he has a 0.00001% chance of gaining clients.

During college I came back from a larger city to the area I'm from and tried to apply my work as a network consultant back there to get me new bussiness here. I ahd no contacts and at least 3 existing companies did much the same as the one he works for (from the sound of it). Major companies (200+ staff within the area and the ones with money to spend) have their own IT departments (however small those may be), so only the small fries need network consultants (aka the 'portable IT department'). The problem? Those companies can't even pay $100/hour. Most of the existing 'firms' charged $80, which was nearly the limit those places coudl afford (in fact I know several that would toss the consultants out when the reached whatever fixed limit they could afford whether the work was done or not).

I came in and found I knew no one... I couldn't even get my foot in the door with most places, so I ended up taking a retail job for five years... It's been a year since then and I have developed a few contacts that will get me work, but I have about half a dozen clients who can barely afford to pay me (I've had to take some assignments on very low flat fees, or even down work for free to get my foot in the door). It's been a very long and tough process. Even now I'm looking at a long term conttract that pays almost nothing compared to what I will do... The contract calls for me to create a computerized inventory system and client database and then set up an online store from scratch (which isn't even exactly within my normal range of skills)... All by myself. What am I being paid? ~$1800/month as a flat fee. At which I'm more expensive per month than their rent and only because they feel I can make at least that much a month for them through the web am I getting this job at all. It will be the most I've earned yet since I came back.

You make it sound so much easier than the reality is...