Out of hours support contract

[pauljh]

Hello All,
After umming and ahhhh about becoming an IT Contractor for about the last 20 years I've been given the opportunity too, but my potential client wants to know if I can also provide out of hours support for their systems. Technically this isn't a problem but I'm unsure of what a reasonable amount to charge is (I don't expect specifics just some "rough" calculation based on hourly rate). I was "thinking" maybe 1/16 my hourly rate for each hour outside of working hours but with Sundays, bank holidays and unsociable hours (10pm until 7am) being double this. This rate would only be for "being available" (with a 1 hour response time) and then for each incident I would charge my normal rate (except double for periods mentioned previously). I know the usual answer is "It depends what its worth to you", but just curios if others have came across such a situation and if so what calculation they used to work it out as I don't want to go in too low and regret it, and I also don't want to over the top and scare them off.


Regards

Paul

[tim123]

The answer to this question must depend upon how often you are going to be 'on call'.

If it's every weekend, you are going to want a damned sight more (for each weekend) than if it's one weekend in 10.

tim

[r0bly0ns]

Never run an out of hours support contract as a business, but I have worked one as a permie about 10 years ago. Saturday's only.

Back then, I received £50 per day flat fee for being an call, £100 for my first call out and then double my normal hourly rate for every hour worked after the first.


I would expect that my employers where billing at least double this, and this was 10 years ago.

[KevinS]

I've done one contract (DBA work) where I provided out of hours support. I charged them a normal hour for each call out, regardless if the call was 2 minutes or 59 minutes, after which a new hour started..

[stan2484]

I would look at for a week on call say £3-500, and then standard hourly rate per hour called out between 08:00 - 20:00hrs, then all other time at time and a half or double time outside these times for a Sunday.

Good luck and screw them for as much wedge as you can.

[thunderlizard]

Don't just look at how much work you're likely to have to do (cost-based pricing) - look at how important your support is to your client (demand-based pricing). E.g.

system A: needs average 100 hours support per year and an hours outage costs
your client £1000. If unsupported it would go down for 100 hours: your client could lose £100,000 over the year, so maybe charge them £20,000 pa for support.

system B: needs average 5 hours support per year and an hours outage costs your client £1,000,000. If unsupported it would go down for 10 hours: your client could lose £10,000,000 so maybe charge them £2,000,000 pa for support.

obviously it depends on what competition is out there too, but your bum-on-seat hourly rate has very little to do with it.

[pauljh]

Hi All,
Thanks for the replies, I'm starting to think I'm under quoting. As its a company I used to be a permy for (2 years ago) out of hours support was usually about 1-2 a week with the fixes being either 30 minutes or 4 hours, BUT during "tricky" times (i.e. Christmas) when lots of things change this can be a LOT more. I quoted 1/16 rate for standby and they have come back to me saying 1/32 and only time and half for out of office hours, I think I might just forget the whole thing!
As for how much it would cost them, its tricky, if its a 4 hour problem which effects the supply of items it could cost them £20000 for that one problem easily.

Paul