Feb
15
The Value System
I know we have all seen those ads for $400 and $500 computer systems or less. And when we saw them, we thought that computers are coming way down in price. Pretty soon you’ll be able to replace all of the aging computers in your office at a fraction of the cost for which you initially purchased them. The computers have come down in price, but only slightly.
What’s really happening is this — as technology improves from year to year, last year’s technology is looking better and better. And last year’s technology is always cheaper than this year’s. When you see a very inexpensive computer, there are 4 things that will always be true:
1) The system is of low quality and based on older technology.
2) It has a 1-year maximum warranty.
3) It was just a way to get you into the store or on the website.
4) It’s going to cost more to service than a better system.
Just like any other product, not all computers are created equal. Each computer is only as good as the sum of its components. There are different types of components like processors and hard drives. Some are built for quality and performance and others for price. For the most part computer manufacturers, like HP, Dell, and even EIT, do not produce every component inside a computer. We use components built by other manufacturers. Seagate and Western Digital manufacture hard drives; Intel and AMD manufacture processors; and the list goes on to encompass every component found in a computer.
In order to hit a specific price point, manufacturers frequently opt for lower quality components or those based on older technology. We in the industry call this the “Value System” – designed to give the purchaser a moderate amount of functionality and quality. I’ve seen Dells before that only came with a 30-day warranty without an option to extend. Tell me there’s not something going on there.
You can also find very nice high-quality systems from Dell. The point here is not every model carrying the same brand is composed of the same quality or type of components. I’m not saying your $400 computer is going to blow up after a year. But I bet the odds would be better if you spent a little more at the time of purchase. I’m always seeing similar models from manufacturers coming in with the same problems. For instance, I have two clients who purchased the same “Deal Laptop” for really cheap. Within the first year, they both came in and needed new hard drives. They were under warranty, but that didn’t cover my data recovery services. Later on, they both came in with cooling problems… another service bill. Especially with computers, you get what you pay for.
From a business perspective, there are two main purposes for the value system. If you purchased the value system from a company who also offers services (i.e. the local computer shop or Best Buy), they just want the make service revenue off of you. If you don’t have a computer, they can’t offer you services. If you buy this inexpensive system, you become a service customer instantly. Most likely the system will have problems just outside the warranty period, and you will have either a costly repair bill or another new system.
The other purpose of the value system is to lure you in to the store or on to the website. Once more, closely examined, you’ll normally find the system is very limited or doesn’t come with such a good warranty. You may ask yourself, “Why can’t I get more than a one year warranty on this system?” Once in the store or on the website, statistically you’ll be more likely to buy a more expensive computer with the functionality and quality you really need or want.
I don’t sell value systems to my clients. I could, but I don’t touch those things. For one, there’s no margin. And two, they take up too much of my time to service, upgrade, and replace. That usually equates to employee down-time and costly service calls. In this day and age, that’s just not acceptable. I would much rather help my clients purchase a system that will be dependable and will come with at least a 3 year warranty. In the long run, it costs less because the system requires less service, works faster, and lasts longer. All this equals more uptime and productivity…and we all know what that does for the bottom line.
Below, I have listed the general guidelines that I send to all of my clients and friends when they want purchase a system on their own. Each guideline should be considered a minimum specification. In this industry, the more the better. Each application and business is different so they have different needs. I’m not claiming this will be the right system for your business, but I have found it works well for most of my clients. And, of course these, specifications will change drastically over time, so don’t come back to reference this in 2011.
1) Intel Core2 Processor w/ 1333MHz FSB
2) 4GB or RAM
3) 250GB Hard Drive
4) 64-bit Operating System
5) 3 Year Parts and Labor Warranty
If you purchase a system today meeting these guidelines, the following will always be true:
1) The system will provide 3-5 years of good performance.
2) It will have a warranty for at least 3 years.
3) It will cost $700-$1,000.
Since the system will last longer, you’ll spend less money in service because you won’t have to replace the system as often. I think most other computer service companies push value systems just so they can replace them more often. You and your employees will be able to work faster because you’re not waiting for your system to startup or perform some other process. No reputable company would allow you to spend around $1,000 on a system without backing it by a good parts and labor warranty. As the months pass, the guidelines increase, but the price is always about the same. If you want your technology to work well for you, this is the ballpark where you should be when purchasing workstations.
If you’re still confused about any of this stuff, luckily I’m only a phone call or email away.
© 2010 Engler Information Technologies, Inc.