When something breaks you want the best service at the lowest price, as fast as possible. Without a service Contract you call for service when you need it, and pay the highest rates, with no guaranteed response time. The good news is the you don't have to think about service until you need it. The bad news is that repairs are expensive and they can take a long time. Most service contracts are priced according to your list of equipment, based on the costs of repairs your service provider believes you will need during the contract term.
Some companies use their own staffs to repair their computer hardware.
Most in-house technicians do not maintain up to date service manuals, and they cannot call the manufacturers' technical support lines for assistance. It can be more expensive per repair than using an authorized service provider. Many businesses justify the added expense because their in-house staff knows their computer environment and can support the needs of the staff. This frees up your staff to respond to other support needs. You reduce your backlog and get better service.