From the January 1998 issue of Startups

Time isn't something most homebased business owners can afford to waste. Just ask Gilda Krywosa, owner of Gilda's Accounting & Tax Services in Boonville, New York. Like most homebased business owners, handling all the administrative, marketing and advertising duties, as well as servicing her clients, leaves Krywosa little time for much else. That's why the excruciating delay she experienced when printing or tabulating tax returns on her computer just wouldn't do, particularly during the tax season.

"I don't like wasting time waiting for things to print or for numbers to total," says Krywosa, who opened her tax and accounting business last January in the corner of a renovated barn on her rural property. "I needed more memory, more speed and a more powerful computer to operate the [tax] programs [needed] to run my business."

Whether you're like Krywosa and aren't satisfied with your computer system's performance, you've hired a second employee who needs a computer, or you've glimpsed the latest hardware and are itching to buy, there comes a time when you outgrow your first PC. That's especially true for homebased business owners who share their multimedia home PCs with the family, usually because they can't justify purchasing a machine just for business. But all it takes is having files accidentally zapped by your 7-year-old or letting work suffer while the kids use the computer to do their homework to realize it's time to purchase another computer.

The Buying Game

The good news is, you've probably learned a thing or two about purchasing computer equipment since you bought your first PC. You're more knowledgeable about your business's technology needs, and you may already know what areas you'd like to improve. Maybe the monitor on your current computer is too small and strains your eyes, so now you want a larger one. Or, if your first PC came loaded with a 3-D graphics card, multimedia encyclopedia and games for the kids, you probably found little business use for these features and want to find a PC without all the recreational features.

"Usually, [homebased business owners'] second purchase won't have anywhere near the bells and whistles their first machine has," says James Staten, industry analyst with Dataquest Inc., an information technology research firm in San Jose, California. "You'll sacrifice things like 3-D graphics cards because you don't need them."

While there isn't a single solution that fits the bill for every homebased business, there are guidelines to follow. For example, if you plan on using your second PC for general productivity purposes such as running word processing, spreadsheet and general accounting software, you'll need to invest in a machine with a faster processor and larger hard drive. If you'll be using it primarily for communication purposes, such as sending e-mail, surfing the Web or faxing, look into a PC with a high-speed fax/modem. Those who plan to create advertising and marketing materials in-house may want a higher-end graphics system with lots of memory.

A slew of technology vendors are rolling out computers designed specifically for the small office/home office (SOHO) market. Overall, these computers serve homebased businesses well because they come stocked with fast processors, large hard drives, speedy modems, remote-control software and advanced support software to diagnose computer problems quickly. They also come pre-installed with leading business software. For instance, Apple Computer Inc.'s Small Business Power Macintosh models boast Microsoft Office, Norton Utilities, Now Software's Now Up-to-Date & Contact contact management program, Jian BizPlan Builder and more.

Packard Bell's all-new Platinum 4200 computer for the SOHO user comes loaded with a fast 266 MHz Intel Pentium II processor with MMX technology, a 7.0GB hard drive, a Digital Versatile Disc Drive, a 56 KBps modem with U.S. Robotics X2 technology, and a telephone answering system with full-duplex speakerphone. It also has a variety of innovative customer support features. One such program is PC Doctor, which performs tests to detect hardware and software errors. CyberWarner warns users when they're about to make a critical computer error and logs the action online so that a customer service representative with remote-control software can easily determine the problem.

When deciding what type of system you need, don't rule out a laptop. Today's laptops boast powerful processors and lightweight designs, making them ideal for displaying sales presentations on the road. They also make sense for accounting, real estate or any kind of homebased business that could benefit from inputting or furnishing information on the spot.

On Second Thought . . .

Typically, homebased business owners buy their first computers through retail channels. Computer or electronic superstores work well for first-time buyers because you get to test the equipment before buying it and have your questions answered by a salesperson--and you get to bring the goods home the same day. However, when you're buying your second computer, consider other avenues, such as mail order, value-added resellers or buying direct from manufacturers. These options typically offer competitive pricing, and they can add a greater level of expertise and support to your business than you'd get from a retailer. Consider the following:

Mail order. Convenience is the obvious benefit of buying through mail-order giants such as Gateway 2000 Inc., MacWarehouse and Dell Computer Corp. Place one phone call, and the goods will be shipped right to your door. And, unlike in retail, where what you see is what you get, some mail order companies will build custom computer configurations for you so you can get the computer that's perfectly suited for your business. Your PC can be configured with more memory, a specific graphics card or a gargantuan hard drive, for example.

But the chief reason to consider mail order? It's the first step in building what could become a long-term alliance with a high-tech supplier. "Homebased business buyers are flocking to [mail order companies] because they can have a direct relationship with a vendor and rely on them as another source of support," Staten says.

Manufacturers. Many computer manufacturers are also boosting their built-to-order business. An advantage to this method is price: Cutting out the middleman gives direct vendors the freedom to offer a better deal.

Through NEC Computer Systems' new customer-direct program, NEC Now, you can choose from one of four NEC Now models or any NEC machine available. Request any special configurations before placing an order. Provided there are no unusual requests, the machine will be built and delivered within five working days. You can also opt to have the computer sent to a reseller in your area who can install it or provide additional services.

Resellers. These also offer the benefit of long-term relationships, and they can provide a level of expertise most other sources can't match. "If you buy from a reseller, you can develop a relationship over time that you can rely on, particularly as your business grows," says Kathleen Tandy, marketing manager for Hewlett Packard's Small Business Computing Organization. "They are an excellent source of information on new services and products, and they'll suggest options you'd probably never consider, like setting up electronic links with customers if you're a small wholesaler or an ISDN line if you're an accountant and want a high-speed connection to a bank."

Leasing. Consider computer leasing if you plan to upgrade equipment frequently. Many businesses favor leasing because it lets them use the latest technology without making a substantial investment. Leases are offered from computer retailers and vendors as well as from third-party leasing agencies. Length and terms vary. Gateway 2000, for instance, sets up leases itself and honors those made through third-party leasing agencies. When your lease expires, you can simply return the computer. Depending on the type of lease you signed, you also have the option to buy the computer for fair market value, 10 percent of the price you paid, or for $1 through a buyout program.

Customer service. If you haven't considered the customer service you'll receive when you buy a computer, now's the time to do it. Customer support is critical when buying your second computer because not only do you lack the time to spend hours on the phone with tech support, but chances are your level of technology sophistication has increased as you've grown. If you now use advanced business software or a backup drive to protect your data, the assistance you need has moved beyond the more basic questions some tech support lines answer, so consider buying from a company with advanced support for small businesses.

Electronic remote support is another service many homebased businesses need. With your permission, tech support will access your computer remotely, scan it for problems, run diagnostic tests and solve your problems from afar, saving you the hassle of taking it in to be fixed or fiddling with it yourself.

Excellent support is one reason Krywosa eventually purchased a Hewlett Packard Vectra 500 series (now redesigned and called the Brio series) computer, which comes with a three-year limited warranty and one year of on-site support. She bought it through a reseller--and was glad she did when, in the middle of tax season, she experienced a hard-drive failure. "It could've been a disaster," she says, "but [the reseller] hooked my computer up with a network and saved my programs and data. Then they reloaded a new hard drive and re-installed my information. I lost nothing, and it didn't put me behind or cause me to lose business."

Powered Up

Buying a second computer can solve critical business problems, translating into money in the bank. For example, with her new PC, Krywosa now has enough power and speed to run Lacerte Software for Taxes, which she uses to process tax returns for clients.

But more than just working in the fast lane, Krywosa can now perform tasks that she couldn't before. For instance, her Vectra 500 series computer came with a speedy modem that she uses for researching tax information on the Internet, downloading tax forms, and accessing services that she previously couldn't. Her new computer also has enough power and memory to run Print Shop Deluxe, a desktop publishing program she purchased to create her own business cards and stationery as well as design advertisements. All this, she says, gives her complete control over the marketing and advertising aspects of her homebased business at an affordable price.

You'll probably notice having a second PC also fosters collaboration between you and your employees. If there's a rush job, you can work on one portion of the task while an employee tackles another. Having a second PC also gives you the opportunity to split up business functions. For instance, one computer can be used just for communication purposes, such as faxing, sending e-mail or surfing the Internet. Or, you can use one machine to store critical documents while the second one serves as the "slave," where all of the word-processing and daily tasks get done.

If you feel there's a lot to consider before you buy, you're right. But it's important to think through all your options carefully. Analyze all the new hardware and software available and investigate several different methods of buying. By doing your homework, you'll likely be more satisfied with your second PC purchase than you were with your first.

Compaq

Model: Armada 1585DMT (notebook)

CPU: 150 MHz Intel Pentium processor with MMX technology

RAM/hard drive: 16MB (expandable to 80MB); 2.1GB

Monitor: 12.1-inch TFT active matrix display

CD-ROM drive: 12X

Modem: 33.6/14.4 KBps data/fax

Software included: Windows 95/NT, Intuit ExpensAble, Quicken Special Edition and more

Warranty/support: One-year limited warranty; phone and online support

Suggested retail price: $3,699

Toshiba

Model: Satellite Pro 460CDT (notebook)

CPU: 166 MHz Intel Pentium processor with MMX technology

RAM/hard drive: 32MB (expandable to 160MB); 2.02GB

Monitor: 12.1-inch TFT active matrix display

CD-ROM drive: 10X

Modem: 33.6 KBps data/fax

Software included: Windows 95, America Online, CompuServe

Warranty/support: Three-year limited warranty; phone and online support

Suggested retail price: $4,299

Packard Bell

Model: Platinum 4200

CPU: 266 MHz Intel Pentium II processor with MMX technology

RAM/hard drive: 32MB (expandable to 256MB); 7.0GB

Monitor: Available in a 15-inch or 17-inch SVGA display (not included)

CD-ROM drive: 24X or Digital Versatile Disc Drive

Modem: 56/14.4 KBps data/fax

Software included: America Online, CompuServe, Taking Care of Business Software Suite with Microsoft Windows 95, Microsoft Works, Microsoft Money

Warranty/support: One-year limited warranty with 90 days on-site service for registered users; pay-as-you-go phone service

Suggested retail price: Starting at $2,499

Dell Computer

Model: XPS H266

CPU: 266 MHz Intel Pentium II processor with MMX technology

RAM/hard drive: 32MB; 4.3GB

Monitor: 17-inch SVGA display

CD-ROM drive: 16X

Modem: 33.6/14.4 KBps data/fax

Software included: Windows 95, MS Office 97 Small Business Edition

Warranty/support: Three-year limited warranty with one-year on-site service; phone support

Suggested retail price: Starting at $3,299

Apple Computer

Model: Small Business Macintosh 6500

CPU: 250 MHz PowerPC 603e RISC processor

RAM/hard drive: 48MB (expandable to 128MB); 4GB

Monitor: 21-inch standard (not included)

CD-ROM drive: 12X

Modem: 33.6/14.4 KBps data/fax

Software included: Small Business Software bundled with Microsoft Office, America Online and more

Warranty/support: One-year limited warranty; phone support

Suggested retail price: $2,299

Gateway 2000

Model: G6-266

CPU: 266 MHz Intel Pentium II processor with MMX technology

RAM/hard drive: 64MB (expandable to 256MB); 6.4GB

Monitor: 19-inch EV900

CD-ROM drive: 12/24X

Modem: Not included

Software included: Windows 95, MS Office 97 Small Business Edition, TripMaker 97

Warranty/support: Three-year limited warranty; phone and online support

Suggested retail price: Starting at $2,949

IBM

Model: 300GL

CPU: 200 MHz Intel Pentium processor with MMX technology

RAM/hard drive: 32MB (expandable to 128MB); 2.5GB

Monitor: 17-inch CRT display (not included)

CD-ROM drive: 16X

Modem: Not included

Software included: Windows 95/NT, Lotus SmartSuite, IBM HomePage Creator, Microsoft NetMeeting

Warranty/support: Three-year limited warranty with one-year on-site service; phone, online and remote support

Suggested retail price: Starting at $1,503

Hewlett Packard

Model: Brio 8178

CPU: 233 MHz Intel Pentium processor with MMX technology

RAM/hard drive: 32MB (expandable to 192MB); 6GB
Monitor: Not included

CD-ROM drive: 24X

Modem: 56K U.S. Robotics data/fax

Software included: Microsoft Windows 95, Microsoft Word 97

Warranty/support: Three-year limited warranty with one-year on-site service; online and phone support

Suggested retail price: $2,087

Contact Sources

Apple Computer Inc., http://www.powermacintosh.apple.com

Compaq Computer Corp., http://www.compaq.com

Dataquest Inc., e-mail: askdq@dataquest.com, http://www.dataquest.com

Dell Computer Corp., http://www.us.dell.com/products

Gateway 2000 Inc., (800) 338-0169, http://www.gateway.com

Gilda's Accounting & Tax Services, (315)942-4357, fax: (315) 942-2175

Hewlett Packard Co., (800) 752-0900, http://www.hp.com

IBM, http://www.us.pc.ibm.com

NEC Computer Systems, (800) 632-4636, http://www.nec-computers.com

Packard Bell, (800) 733-5858, http://www.packardbell.com

Toshiba America Information Systems Inc., http://www.computers.toshiba.com