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Is Your IT Outdated?
When it comes to upgrading existing technology or buying new computers, most small business owners are at a loss. Here's how to decide what stays and what goes. Maximize Upgrades Self-employed. Invest in a PC with a spacious hard drive and 512 MB of memory. The upfront cost will lower the total cost of ownership. Micro (<5 employees). Use networking to share printers, scanners and peripherals. Small (6+ employees). Create a staggered technology replacement schedule to even out expenses and tax deductions over time. The decision to upgrade your company's aging technology falls squarely between efficiency and finance. Not only is it necessary to determine when a system no longer provides maximum productivity, but there are price issues and tax implications to consider. "A company that develops an effective strategy has a clear advantage," says Bob Gaby, principal at Information Technology Group Inc., a Simi Valley, Calif. technology consulting firm. "The lifecycle of today's PC is typically three to four years, so one strategy is to develop an upgrade cycle that replaces one-third of the units every year." If you have power users that need more advanced systems, purchase new PCs for these employees on an annual basis and hand the systems down as needed. This approach, Gaby says, helps spread tax deductions more evenly while minimizing upgrades and repairs. (continues...)