The short answer
- Break-fix is billed hourly, after a failure. Managed IT is a fixed monthly fee covering monitoring, patching, security and support.
- Under break-fix, your provider earns more when things break. Under managed IT, they earn the same either way, so prevention is in their interest too.
- Break-fix can be cheaper in a quiet year. It is far more expensive in a bad one, and you cannot budget for it.
- Most businesses switch after an incident that break-fix could not have prevented, rather than because of the running cost.
The two models, defined
Break-fix is the older arrangement and still the most common among very small businesses. Something stops working, you call someone, they fix it, and you get an invoice for the time and parts. Between those calls, nobody is looking at your systems. Managed IT is a fixed monthly arrangement where the provider takes responsibility for running and securing your technology. Your environment is monitored, patched, backed up and supported continuously, and the reporting tells you what happened rather than leaving you to ask.
The real distinction is not the billing method. It is whether anyone is responsible for your systems on a day when nothing is obviously wrong.
Side by side
The differences that matter in practice, rather than the ones that appear on a sales sheet.| Topic | Break-fix | Managed IT |
|---|---|---|
| How you pay | Hourly, per incident | Fixed monthly fee |
| When work happens | After a failure | Continuously, before failure |
| Budgeting | Unpredictable | Predictable |
| Who carries the risk | You | Shared, and defined in writing |
| Security | Usually reactive | Built into the service |
| Provider incentive | More failures, more revenue | Fewer failures, same revenue |
| Response commitment | Best efforts | Written response times |
The cost comparison people get wrong
Compared month to month in a quiet period, break-fix usually looks cheaper. That comparison is the problem: it prices the good months and ignores the bad one. The costs that do not appear on a break-fix invoice are the ones that hurt. Staff sitting idle during an outage. A recovery that takes three days because nobody had tested the backup. A cyber insurance renewal that gets harder because you cannot evidence any controls. None of that is billed by your provider, but all of it is paid by your business.Downtime is the largest hidden cost
Work stops for everyone affected, not just the person who raised the ticket. In a 20-person business, a morning offline is roughly half a working week of lost productivity.Deferred maintenance compounds
Under break-fix nobody is patching, so vulnerabilities and ageing hardware accumulate quietly until several problems arrive together.Emergency work costs more
Urgent, out-of-hours remediation is the most expensive way to buy IT labour, and it is exactly what break-fix produces.When break-fix is still reasonable
It is not indefensible. If you are a very small team, run almost entirely on cloud services with no servers, hold no sensitive client data, and could lose a day without material harm, break-fix may genuinely be enough. What tends to end that arrangement is not growth in headcount but growth in dependency, or an external party starting to ask questions: a client security questionnaire, a cyber insurance renewal, or a tender requirement.What changes when you move across
The first month is mostly discovery. A provider documents what you actually have, which for many businesses is the first complete picture they have seen, and stabilises anything urgent before adding monitoring, patching and security tooling. The change your staff notice is smaller than expected and mostly procedural: a helpdesk to contact rather than a phone number for the person who usually helps. The change your leadership notices is a predictable monthly figure and reporting that arrives without being chased.
Ask any provider for a written scope with inclusions and exclusions. Two quotes are only comparable when you can see what each one leaves out.
Where Techware fits
We run fully managed IT with published pricing tiers, and co-managed arrangements for businesses that already employ an IT person and want to keep them. Either way, the scope is written down before anything starts.
Common questions
Is managed IT more expensive than break-fix?
In a quiet year it often is. Across a typical year that includes incidents, usually not, and the monthly figure is predictable rather than a surprise.Can we mix the two?
Do we have to replace all our hardware to move to managed IT?
What happens to our existing IT person?
Reviewed by
The Techware team, Clayton, Melbourne
Techware has supported Australian organisations for more than 25 years and holds ISO 9001 for quality management and ISO 27001 for information security. This page is part of our Managed IT 101 guide, written to answer buyer questions plainly rather than to sell.
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