A small business typically spends a few percent of revenue on IT overall – more for technology-dependent businesses, less for others. Per employee, all-in IT cost usually lands in the low hundreds of dollars a month once you include support, software, hardware replacement and connectivity.
What the IT budget covers
- Support – managed IT or internal staff (see managed IT pricing)
- Software subscriptions – Microsoft 365 / Google Workspace, line-of-business apps, security tools
- Hardware – a rolling replacement cycle for computers (every 3-5 years) and servers/network gear
- Connectivity – business internet, failover, phones
- Projects – migrations, an office move, a new system – budgeted separately
Where to prioritise if the budget is tight
- Security basics first – MFA, backups, endpoint protection – these prevent the expensive events
- Reliable internet and support – downtime costs more than the fix
- Replace the oldest hardware on a schedule, before it fails
- Then growth-enabling projects
Signs you are under-spending
- Computers over five years old still in daily use
- No tested backup
- Security is ‘whatever came with the computers’
- IT is only budgeted when something breaks
A fixed managed fee makes the largest, least predictable part of this budget stable – see managed IT services.
IT buyer’s guides
- What is a managed service provider?
- How much do managed IT services cost?
- Break/fix vs managed IT services
- What to look for in an IT support contract
- In-house vs outsourced vs co-managed IT
- How to switch IT providers
- Signs your IT provider is failing you
Thinking about managed IT in Edmonton? Call +1 (587) 400-9991 (also on WhatsApp) or request a quote. We start with a short review at no cost.
Frequently asked questions
What percent of revenue should go to IT?
Commonly a few percent for a typical small business, higher for technology-intensive ones. It is a guide, not a rule – the right number is what keeps you secure, reliable and able to grow.
Is it cheaper to delay hardware replacement?
Short-term yes, long-term no. Old hardware fails at the worst time, runs slower (a productivity cost), and eventually stops getting security updates.
How do we make IT spend predictable?
A managed IT plan for support, subscription software billed monthly, and a hardware replacement fund set aside each year turn most of IT from lumpy capital costs into a steady operating cost.
How does Scandifix help with IT budgeting?
Our quarterly review includes a rolling budget – what is coming up for replacement, what projects are on the horizon, and what it will cost – so there are no surprises.