Just Say No to Tech Purchases That Won’t Yield ROI

by QuickBooks

2 min read

When your kid asks you for a toy you can’t afford or don’t think is appropriate for his or her age, you simply say “no.” Sure, your response may elicit tears or a tantrum, but you know what’s right for your child.

The same is true in your other important role: the owner of a small business. When one of your employees asks you to buy a digital device or a software suite that has questionable business value, you should say “no.”

We’re not just talking about a business that’s so strapped for cash that almost any nonessential spending is out of the question. Technology purchases should always be made with your return on investment, or ROI, in mind.

Expenses Don’t Stop After Purchase

Paying for that new computer, software, mobile device, or peripheral is only the first expense you’ll incur with most technologies. Smartphones have voice and data plans. Laser printers tend to eat up expensive ink and toner. And pretty much everything you buy for your employees needs tech support.

That support could be as simple as having your resident geek run a virus scan or as complicated as bringing in a technician to troubleshoot your network. In either case, it will cost you in an employee’s valuable time or a fat check to an expert.

All of those extra expenses are what consultants like to call “total cost of ownership,” and it always adds up to quite a bit more than the actual purchase.

A Few Cost-Saving Tips

With that in mind, always ask your employees (and yourself, for that matter): How will a product or service help the business?

Salespeople, for instance, probably should be equipped with a smartphone, because they need to access their email and voice mail messages from clients (and you) no matter where they are. When they’re on the road, going back to the hotel or hunting for an internet cafe is a huge waste of time, and ultimately money.

Meanwhile, employees who spend nearly all of their working hours on-site don’t need a smartphone to receive messages. Rather than purchasing the hardware, you might offer to pay, say, 10 to 20 percent of the data bills for employees who use their personal devices for work a few hours per month.

When you’re buying computers, you can save money by not paying extra for extras like a graphics card — unless your employees are doing serious work with applications like Adobe Photoshop or a video-editing package. (Otherwise, that card may only be “useful” when someone wants to play a video game on a work PC.)

Finally, there’s your network and your connection to the internet: Look into a commercial account, but be wary of paying a premium for speed you don’t need. Frankly, most small business will do just fine with a connection that offers the kind of performance you’d get at home from your cable provider. On the other hand, if you’re sending large files to customers or partners, or doing a lot of desktop video conferencing, paying more for a faster connection may be well worth it.

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