IT Budgeting for 20 to 100 Employee Companies

The Under Spend and Over Spend Trap

Many SMBs fall into one of two traps. They under-spend on IT until something breaks, or they over-spend on tools that do not align with business growth.

For Québec companies with 20 to 100 employees, IT budgeting is not about cutting costs. It is about aligning spend with operational risk, compliance needs, and expansion plans.

Core IT Budget Categories

A practical IT budget should be structured around five core categories:

• Devices: laptops, workstations, mobile devices, lifecycle replacement
• SaaS and Licensing: Microsoft 365, cloud platforms, line-of-business apps
• Security: endpoint protection, backup, MFA, monitoring
• Support: helpdesk, monitoring, maintenance
• Projects: upgrades, migrations, infrastructure improvements

Most structured environments align these categories under managed IT services with integrated cybersecurity controls.

Benchmarks You Can Use

While every business is different, common benchmarks for SMBs include:

• IT spend per user annually: 1,500 to 3,500 CAD
• Security allocation: 15 to 25 percent of total IT budget
• Device refresh cycle: every 3 to 4 years
• Backup and disaster recovery: mission-critical systems covered at all times

Per-user modeling simplifies forecasting and keeps spending aligned with headcount growth.

Run Grow Transform Framework

To prevent reactive budgeting, divide IT spend into three buckets:

• Run: day-to-day operations and support
• Grow: tools that enable expansion and productivity
• Transform: strategic improvements and modernization

This structure ensures IT spending supports both stability and innovation.

Budget Template Walk Through

Your annual budget sheet should include the following lines:

This simple structure makes it easier to evaluate cost per employee and forecast growth impact.

Frequently Asked Questions

What percentage of revenue should IT represent?
For SMBs, IT typically ranges from 3 to 6 percent of revenue, depending on industry.

Should security be a separate line item?
Yes. Security visibility prevents underfunding risk controls.

How often should budgets be reviewed?
At minimum annually, with quarterly checkpoints.

Next Step Download the Editable Budget Template

AET Solutions provides an editable Google Sheet and Excel IT budget template tailored for Québec SMBs.

👉 Download the IT budget template and align your spending with risk and growth goals.

The Cheap Month That Got Expensive

Break-fix IT often feels affordable at first. You only pay when something breaks, and during a quiet month, costs look low. The problem is that the expensive months are unpredictable, unavoidable, and often arrive at the worst possible time.

For many Montréal SMBs, one outage, ransomware incident, or failed server turns a “cheap” IT model into an emergency expense that far exceeds a year of managed services.

Direct and Indirect Costs You Cannot Ignore

Break-fix costs are easy to see: hourly labor, emergency callouts, and replacement hardware. What is harder to quantify are indirect costs.

Downtime stops employees from working. Missed deadlines affect customer confidence. Data loss or security incidents can trigger compliance issues and reputational damage. These costs rarely appear on an invoice, but they directly affect revenue.

Managed services shift IT spending from unpredictable expenses to a fixed monthly operating cost, while reducing exposure to these hidden losses.

Response Time Models Compared

With break-fix support, response time depends on technician availability and urgency at the moment of failure. If multiple clients have emergencies, response is delayed.

Managed service providers operate under defined service-level expectations. Monitoring identifies issues before users notice, and response times are contractually aligned with business impact.

This proactive model is delivered through structured managed IT services rather than reactive ticket handling.

Security Posture Differences

Break-fix environments typically focus on restoring systems after failure, not preventing incidents. Security updates, patching, and monitoring are inconsistent and often deferred.

Managed services integrate security controls such as endpoint protection, patch management, backup monitoring, and incident response as part of daily operations.

This approach aligns IT operations with a broader cybersecurity strategy instead of treating security as an afterthought.

A Simple 12 Month Total Cost of Ownership Model

To compare break-fix and managed services fairly, SMBs should evaluate total cost of ownership over 12 months.

Break-fix costs include hourly labor, emergency premiums, downtime losses, security incidents, and deferred maintenance. Managed services include a predictable monthly fee covering support, monitoring, maintenance, and security controls.

When modeled over a full year, managed services typically reduce cost volatility and significantly lower operational risk.

Frequently Asked Questions

Is break-fix ever a good option?
Break-fix may work for very small environments with minimal risk, but it scales poorly as businesses grow.

Are managed services more expensive?
On paper, monthly fees may appear higher. In practice, total annual cost and risk exposure are usually lower.

Does MSP support remove the need for internal IT?
Not necessarily. MSPs often complement internal staff rather than replace them.

Next Step MSP Fit Assessment

AET Solutions helps Montréal SMBs evaluate whether managed services are the right fit. Our assessment compares your current IT costs, risk exposure, and response times against a managed services model.

👉 Request an MSP fit assessment and receive a 12-month TCO comparison template.