How to Price Recurring Disaster Recovery & Business Continuity Services

October 10, 2025

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How to Price Recurring Disaster Recovery & Business Continuity Services

In today's unpredictable business landscape, disaster recovery and business continuity services have shifted from luxury to necessity. Yet for managed service providers (MSPs) and IT consultancies, determining the right pricing model for these recurring services remains challenging. Striking the balance between profitability and client value proposition is crucial for sustainable business growth.

This guide explores effective strategies to price your recurring disaster recovery and business continuity offerings, helping you develop a pricing structure that creates predictable revenue while delivering exceptional value to your clients.

Understanding the Value Proposition of Disaster Recovery Services

Before establishing pricing, it's essential to recognize why clients invest in disaster recovery services:

  • Business survival: According to IBM's 2023 Cost of a Data Breach report, the average cost of a data breach reached $4.45 million, a 15% increase over three years.
  • Regulatory compliance: Many industries face legal requirements for disaster recovery protocols.
  • Competitive advantage: Organizations demonstrating robust resilience capabilities inspire greater confidence from customers and partners.
  • Operational continuity: Minimizing downtime directly protects revenue and reputation.

When clients purchase disaster recovery services on a recurring basis, they're not just buying technology—they're investing in business assurance and peace of mind.

Popular Pricing Models for Recurring Resilience Services

1. Tiered Subscription Pricing

The tiered model offers different service levels at distinct price points, allowing clients to select coverage matching their needs and budget.

Example structure:

  • Basic tier ($X/month): Essential data backup, standard RTO/RPO objectives, business hours support
  • Business tier ($Y/month): Enhanced backup frequency, improved recovery objectives, extended support hours
  • Enterprise tier ($Z/month): Comprehensive protection, minimal RTO/RPO, 24/7 support, dedicated resources

This model allows clients to start with lower-priced options and upgrade as their needs evolve. According to a CompTIA survey, 71% of MSPs find tiered pricing effective for disaster recovery services.

2. Capacity-Based Pricing

This approach bases fees on quantifiable metrics such as:

  • Data volume protected (per GB/TB)
  • Number of systems covered
  • User count

For example, you might charge a base rate of $X per month for core service delivery, plus $Y per protected TB and $Z per covered server.

This model's transparency allows clients to clearly understand cost drivers and provides natural price scaling as client environments grow.

3. Value-Based Continuity Service Retainer Model

Rather than pricing based solely on resources consumed, the value-based model aligns fees with the business impact of potential downtime.

Steps to implement:

  1. Help clients calculate their hourly cost of downtime
  2. Assess their risk profile and recovery requirements
  3. Price based on the value of risk mitigation provided

For example, if a client determines downtime costs them $10,000 per hour, a service guaranteeing restoration within four hours might justify a monthly recurring resilience fee of several thousand dollars.

Key Factors Influencing DR Service Pricing

When determining your pricing structure, consider these critical variables:

1. Recovery Time and Point Objectives

Recovery Time Objective (RTO) and Recovery Point Objective (RPO) significantly impact service delivery costs:

  • Faster recovery times require more sophisticated infrastructure
  • Shorter RPOs demand more frequent backups and greater storage
  • Near-zero RTO/RPO solutions necessitate active-active configurations

Generally, as RTO/RPO requirements become more stringent, pricing should increase proportionally.

2. Service Level Agreements (SLAs)

Your SLAs define performance guarantees and accountability measures. Consider including:

  • Guaranteed response times
  • Recovery timeframes
  • Availability commitments
  • Financial penalties for missed objectives

More stringent SLAs require additional resources and create greater provider risk, warranting premium pricing.

3. Testing and Validation Requirements

Regular testing is essential for disaster recovery efficacy. Your pricing should reflect:

  • Test frequency (monthly, quarterly, annually)
  • Test comprehensiveness (component testing vs. full recovery simulation)
  • Documentation and reporting requirements

Many providers structure their recovery service pricing to include a specific number of tests annually, with additional tests available for supplemental fees.

Developing Your Recovery Service Pricing Strategy

Follow these steps to create an effective pricing structure:

1. Analyze Your Costs

Begin by thoroughly understanding your service delivery costs:

  • Technology infrastructure (backup systems, storage, monitoring tools)
  • Personnel (technicians, engineers, project managers)
  • Overhead (facilities, administration, insurance)
  • Partner/vendor services you resell

Add appropriate margins to ensure profitability while remaining competitive.

2. Segment Your Market

Different client segments have varying needs and price sensitivities:

  • Small businesses typically require simpler solutions with predictable costs
  • Mid-market companies often seek balance between comprehensive protection and cost efficiency
  • Enterprises require customized solutions with rigorous SLAs

Tailor your recurring resilience fees to address the specific requirements of each segment.

3. Competitive Analysis

Research competitor offerings considering:

  • Service features
  • Recovery guarantees
  • Pricing structures
  • Market positioning

While you shouldn't simply match competitor prices, understanding market rates helps position your services appropriately.

4. Communicate Value Clearly

When presenting pricing, emphasize ROI rather than focusing solely on cost:

  • Downtime avoidance: "Our service helps prevent the average $5,600 per minute of downtime reported by Gartner."
  • Risk reduction: "We reduce recovery time from the industry average of 18 hours to under 4 hours."
  • Compliance assurance: "Our solution includes documentation that satisfies regulatory requirements."

Clients invest in outcomes, not technologies or activities.

Implementing Your Pricing Model

Once you've determined your pricing approach, consider these implementation best practices:

1. Bundle Strategically

Consider which elements to include in your base offering versus positioning as add-ons:

  • Core bundle: Essential protection covering standard systems and data
  • Add-ons: Specialized protection for specific applications, advanced reporting, additional testing

Bundling creates value perception while add-ons allow customization and revenue optimization.

2. Contract Structure

Key contractual elements include:

  • Term commitment: Most disaster recovery services operate on 12-36 month agreements
  • Payment schedule: Monthly or annual billing options
  • Auto-renewal provisions: Simplify continuation while reducing administrative overhead
  • Escalation clauses: Address how pricing adjusts for resource growth

Longer contracts provide revenue stability but may require more competitive pricing.

3. Pricing Review Cycles

Establish regular review processes to:

  • Update pricing based on changing costs
  • Incorporate new technologies and capabilities
  • Adjust for competitive landscape shifts
  • Account for changes in client environments

Most providers review and adjust disaster recovery pricing annually.

Case Study: Effective DR Subscription Pricing

A mid-sized MSP implemented a tiered subscription model for their disaster recovery services with the following structure:

Essential Protection:

  • 24-hour RTO/24-hour RPO
  • Business hours support
  • Annual testing
  • Priced at $500/month base + $100/server

Enhanced Protection:

  • 8-hour RTO/4-hour RPO
  • Extended support hours
  • Quarterly testing
  • Priced at $1,000/month base + $150/server

Critical Protection:

  • 2-hour RTO/1-hour RPO
  • 24/7 support
  • Monthly testing
  • Priced at $2,500/month base + $250/server

The result: 78% of clients selected the mid-tier option, creating predictable revenue while providing superior margins compared to their previous time-and-materials approach to disaster recovery.

Conclusion: Balancing Value and Profitability

Effective pricing for recurring disaster recovery and business continuity services requires balancing several factors:

  • The value your solution delivers to clients
  • The actual costs of service delivery
  • Competitive market positioning
  • Client segment needs and expectations

By developing a transparent, value-based pricing model, you create a win-win scenario: clients receive protection aligned with their requirements, while your business builds a predictable, profitable revenue stream.

Remember that disaster recovery services aren't merely technical offerings—they're business assurance programs that protect your clients' most valuable assets. When your pricing reflects this reality, both your clients and your business benefit.

Get Started with Pricing Strategy Consulting

Join companies like Zoom, DocuSign, and Twilio using our systematic pricing approach to increase revenue by 12-40% year-over-year.

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