How to buy a computer for your Home Business

Computer prices have now dropped significantly and there is a wide range of friendly software available for business applications, spurring many businesses to invest in computer systems more than ever before. Indeed no business is too small to benefit from computerization.

It is astonishing to think that for less than $ 3,000, you can now buy enough equipment to set up shop in your home or a small office and keep pace with the rest of the business world. All it takes is a personal computer, software, and a quality printer. Once you've got it, you can do your own bookkeeping and invoicing, send out promotional mailings, and print out documents that are as polished as those from any big corporation.

You can now obtain an Intel 486DX or Pentium-based computer for less than $2,500, in some cases loaded with a full complement of business software programs such as Microsoft Works or Perfect Works. That is enough to provide basic business functions, like creating spreadsheets, keeping a database, composing letters, proposals, and documents, and sending out mailings. Moreover, for around $ 450 you can obtain a colour inkjet printer, which offers quality close to that of a laser printer and can also produce impressive colour printouts. Just three years ago, an entrepreneur would have paid $5,000 for a computer and another $3,000 for a laser printer !

With all the excitement that technology generates, some entrepreneurs lose perspective and forget that a computer is only the means to the desired end. Like any other expenditure decision, the independent business owner should examine the potential benefits and costs of computerizing the business:

Will you be able to make your business some money ...

• By generating professional proposals and marketing mailouts ?
• By improving collections and increasing cash flow ?
• By saving money in outside bookkeeping costs ?
• By improving customer service and increasing sales ?
• By lowering the amount of funds tied-up in inventory ?
• By improving job estimates?
• By gaining control of costs ?

• Software is what makes the computer useful. Decide on the software programs you need to use before buying a computer. Most brand-name computers come with some useful office software, but you may need additional software for your business.
• Different types of businesses have different needs. An accounting program that is appropriate for a construction company may not be a good fit for a retail or a service business. Make sure you choose the proper software for your business first. This is an area where a computer retail center that specializes in business systems and your accountant can be of assistance. There are many low-cost choices now in Windows-based business software programs.
• Invest wisely in power. The vast majority of business software runs on IBM compatible computers. The minimum in processor power to consider for your home office now is a 486DX processor. For engineering and design work an Intel Pentium processor is a must.
• Buy enough memory. The minimum memory to run most of the new Windows programs is 8 MB. Some engineering software may require more memory, but in general the requirements of business accounting software are lower than the requirements for entertainment software.
• New software programs offer many features and require large hard disk storage. It is wise to invest in a large hard disk drive and a 540 MB hard disk is the minimum you should consider today.
• Output is important. Invest in a 14" colour SuperVGA monitor that offers dot pitch of .28mm or less. If you will be doing mostly design work on the computer, a larger size monitor may be desirable. You should insist on a Non-Interlaced type of monitor, for less flicker and reduced eyestrain. Colour inkjet printers are very popular with home businesses since they generate high quality printouts, they can handle letterhead and envelopes conveniently, their prices are reasonable, and they are reliable.
• Expandability is a plus. Make sure the computer has a drive bay to add a CD ROM drive or a tape backup unit, and it has free expansion slots to add a fax modem, sound card, and other expansion cards. A fax modem is a good investment since it provides the capability to send and receive faxes and also connect to the Internet, the world network of computers. Most brand name computers come with fax modems, some include answering machine capability, and some can even operate as a speakerphone.
• Should you invest in Multimedia ? Over the last couple of years there is a trend for many technologies - graphics, sound, CD-ROM, and others - to converge, creating what has been called "multimedia" applications for computers. Most of these applications so far are in training and entertainment, but a lot of business software now comes on CDs. Most home-based entrepreneurs use their computer systems for business and home applications, and in the latter case the computer should have Multimedia capabilities. In the future, "desktop teleconferencing" may become another important application of multimedia technology in the business world.
• Reliability counts in business. Computers can break down, so you should ensure your business system is covered with warranty from the manufacturer and you should check the service coverage. You should consider investing in a computer made by a major manufacturer and you should purchase your system from an established reliable local source that has qualified technicians on staff that can offer service when needed. Check your supplier's references. Recent across-the-board price reductions from major vendors have prompted value-conscious buyers to return to brandname machines. Major established manufacturers now offer prices that are close to the clone-makers, but with the added advantage of useful bundled software, telephone hot-lines for support and troubleshooting, convenient repair warranties, and longer warranty coverage.
• Take your time to make the right choice. Many outlets selling to the home market carry only a limited number of products and are staffed by inexperienced people that have only one objective - to sell you the computer model they have in stock. Do not be rushed into buying a system that does not meet your needs and do not buy too little !

George Karaphillis, B.Eng., MBA is co-owner of Alliance Computer Systems, and specializes in business computer applications. This article originally appeared in the Cape Breton Buyers Guide.

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