Seven Essential Ways to Cut Your Tech Costs Technology costs can easily eat away any budget--a few software upgrades and new systems here, another IT person to manage your network there--and before you know it, you've completely eroded your profits.

Whether your business has just two people or two hundred, these tips can help you cut costs, save money, and let you focus on what's really important: the bottom line.

1. Use Open Source and Free Software
Let's face it--when you're trying to keep your business afloat, plunking down lots of cash for off-the-shelf software hurts like getting a cavity filled without Novocain. Thankfully, freeware and low-cost software can be a pleasant surprise in terms of robustness and functionality.

While not as polished as Microsoft's Office suite (but not as much of a memory or resource hog), OpenOffice.org is a free, open-source alternative with a full suite of applications for word processing, spreadsheets, presentations, and databases that are compatible with Microsoft Office. Though OpenOffice apps let you do nearly anything you can do in Microsoft Office, interoperability between the two suites isn't seamless. For example, if you use Word's Track Changes feature, it can be difficult to later delete or modify your edits when you use the document in OpenOffice, and vice versa.

Google Docs is another viable and free alternative to Microsoft Office--and has no software to download or install. Though it's not nearly as full-featured as either Office or OpenOffice, its basic functionality and streamlined interface may be all you'll ever need.

Creating PDF files may be crucial for business, but spending $450 on Adobe's Acrobat Professional is not. CutePDF is a free program that simply exports files to PDF. Just download and install it; from the target file, choose File.Print, and select CutePDF from the printer menu. (If you're using OpenOffice or Google Docs, you won't even need to install CutePDF--both let you export to PDF directly.)

2. Telecommute
Gartner Research predicts that by 2009, more than 25 percent of the U.S. workforce will telecommute. Telecommuting lets you save on gas costs, but you can also remain just as productive when working at home, thanks to tools that make it easy to connect and collaborate (almost as if you were in the office).

Wikis make it simple to post text or documents so that a group can make comments or changes. Some wikis are free and public, while others are more enterprise-focused, with more robust security features. PBwiki offers three flavors: Business, Academic, and Personal. The site includes WSIWYG editing tools, storage space, SSL encryption, automatic notifications via e-mail or RSS, and controls on access. It also offers reasonable business pricing--it's free for one to three users, $8 per month per user for 4 to 99 users, and $6 a month per user for 1000 to 4999 users.

The aforementioned Google Docs is also telecommuter-friendly, offering an affordable and easy way to share files (and to keep tabs on changes). Once you've created a file in Google Docs, simply invite others to collaborate online. When you're done, you can export the file to Word, Excel, PDF, or PowerPoint.

If you cringe at the thought of setting up a VPN (virtual private network), services like LogMeIn Hamachi may just be your ticket to headache-free remote VPN access. LogMeIn Hamachi promises easy setup using peer-to-peer technology to let off-site employees access files. The service works within your firewall and costs just $5 a month for one user license.

If your company doesn't have, and doesn't need, a centralized server, Central Desktop is a way to share documents online with virtually no setup. The site lets large or small groups easily share files, keep track of who's checked out which files (or modified them), and set up separate desktops for multiple groups of users.

The free plan gives you 25MB of space and supports two workspaces with five users each. The lowest paid plan is $25 per month for three workspaces, 10 users each, and 500MB of file storage. At the high end, $249 a month gets you 100 workspaces, 100 internal users (employees), and 100 external users (vendors, clients, or partners), 25GB of storage, and custom branding. An additional fee brings extra security and Web meetings.

For more tips and case studies, check out PC World's Telecommuting Resource Guide.

3. Hold Online Meetings
Why fly out to see a client when you can hold a meeting in cyberspace? Using free video conferencing software, such as Skype, you need only a Webcam, a PC, and an Internet connection--saving money not only on travel costs, but on long-distance as well. Skype does drop calls sometimes and can be staticky, so hold a few meetings before you drop your landline completely.

If you'd like to upgrade to a more robust Web conferencing service, Cisco's WebEx lets you share documents, supports up to four Webcams, and lets you run presentations from your desktop.

GoToMeeting is another solution that offers VoIP, supports meetings with up to 15 attendees, and lets you give presentations, collaborate, or provide training from your desktop, saving money on travel costs and meeting space. Who doesn't want to make presentations in their pajamas?

For the more adventurous, Second Life lets you create an avatar for free and meet "in-world," make video presentations, and hold virtual meetings or training sessions. You can also buy office space in Second Life if you'd like to set up a more permanent place for employees to meet and collaborate.

4. Buy Refurbished Hardware
While ripping open a box containing a shiny new computer is an unmatched thrill, saving your business a bundle is a close second. Buying refurbished (nearly new) hardware is a great way to get a deal.

If you have your eye on a specific brand of computer, go to that manufacturer's site to find deals on refurbished systems. But note that each vendor defines refurbished a bit differently. For instance, Dell sells three types of refurbished computers, all of which are tested and restored to factory specs: Certified Refurbished includes laptops and desktops that were returned to Dell and may have minor cosmetic dings or blemishes; Previously Ordered New means a PC that was shipped new, but the customer decided to return the system without so much as booting it; Scratch and Dent products may appear a bit more "worn" on the outside, but still work well and don't contain dings or scratches on the palm rest or screen.

The Dell Outlet store lets you search for refurbished Dell desktops, accessories, and laptops by price range; most of the items cost up to 35 percent below retail. For example, a Flamingo Pink Certified Refurbished Inspiron 1720 laptop with an Intel Core 2 Duo CPU, a 17-inch LCD, and a 120GB SATA hard drive was $879 on the Dell Outlet site. Price depends on whether the item has scratches and dents, whether it was ordered new, and other factors. And if you're not happy with your purchase, you can return products within 21 days from the date of shipment, less a restocking fee if the product is not defective.

If you're a Mac devotee, Apple sells refurbished products through its online store. But don't expect huge savings--some of the newer products are a mere $200 less than the retail price. However, in some cases, you can save much more. A recent look at the Apple Store revealed a refurbished MacBook Air (with a 1.6-GHz Intel Core 2 Duo CPU, a 13.3-inch glossy wide-screen display, 2GB of memory, an 80GB PATA hard drive, and a built-in iSight camera) listed at $1499, versus $1799 retail. A refurbished iMac (with a 2.8-GHz Intel Core 2 Extreme CPU, 24-inch glossy wide-screen display, 2GB of memory, a 500GB hard drive, and a built-in iSight Camera) was listed at $1599, versus $2299 retail.

Apple's refurbished products are covered by a one-year warranty, and you can buy an extended warranty as well. Apple's refurbished products are "pre-owned," but Apple's site claims that each item undergoes a "stringent refurbishment process prior to being offered for sale." Some products were returned, while others were brought back due to technical issues. To read the full list of refurbished tests and qualifications, visit Apple's site.

Amazon.com features a long list of refurbished computer resellers, and the site's seller ratings let you immediately know what sort you're dealing with. The sellers also report the condition of the equipment with a rating system: Good, Like New, Refurbished, and so on. Under Amazon's A-Z Safe Buying Guarantee, sellers will let you return items if they're defective.

eBay also offers a wealth of deals. As a buyer, you'll know immediately whether the seller is shady or reputable based on user reviews. Look for a seller with a large amount of positive feedback, at least 95 percent. Be sure to thumb through the buyer feedback to see the comments before you dive in and bid. Like Amazon, eBay backs buyers, and the community will boot anyone out if they aren't on the level.

Refurbished systems may not be under any sort of warranty, and the vendor may sell it to you "as is." This can be a nightmare if, say, the operating system is simply installed on a new hard drive and the drive is stuck back into the computer. Be sure to ask questions of the vendor before buying.

5. Cut Down on Printing Costs
According to GreenBiz.com, you don't have to spend money to be green. You can save on paper costs if you simply photocopy pages on both sides or use outdated letterhead for in-house memos. If your office currently passes out paper memos to employees, try posting the memos instead in a central location (such as a board near the water cooler) where people normally gather and will see it.

Another money-saving tip is to use your printer's draft mode to cut down on ink usage and replace cartridges less often. Draft mode is much faster and uses less ink. When printing e-mail and Web pages, check for a "printer friendly" option.

Color print cartridges typically cost more, so printing in grayscale using only the black cartridge can save money, and you'll replace your color cartridge less often. Most printers offer plenty of settings, so check your printer's software to see what features can save money.

If you rarely print, but your ink runs low anyway, this may be because your printer automatically cleans the print heads. To avoid this, print regularly (at least once a week) to avoid ink buildup.

Watch the PC World video, "How to Save Money on Printing," for more ideas.

6. Outsource Work
Many businesses lack a full-time IT professional or have one very overtaxed person managing the network and systems. Or perhaps you have a Web project that needs finishing or a simple press release you'd like to have written, but don't have the staff.

Instead of hiring a headhunter (whose fees may run 10 to 40 percent of a new hire's first-year salary) or a temp agency, use one of many freelance sites that address all sorts of job functions and don't cost a dime. eLance.com is a sort of freelancer marketplace where contractors post r�sum�s, portfolios, references, and details about their work. Employers can post jobs or invite freelancers to bid directly. eLance tests freelancers on the site in their given skill areas to certify their skills and lets clients post feedback once jobs are completed.

Guru.com is a similar service that lets you search through an available list of freelancers by category, receive bids, award work, view portfolios, and then pay for work once it's completed. Each professional is reviewed by past employers and ranked according to feedback. The site offers a wide range of job categories--legal, programming, marketing, CAD, photography--and is free for employers.

7. Use Virtualization Software
Virtualization software offers many cost-saving benefits, such as consolidating servers and reducing backup and recovery time. And because you're running fewer servers, you save money on your energy bill.

Industry standard VMware's offerings run the gamut, from suites for managing large data centers to VMware Workstation for running multiple operating systems on a single computer. By using VMware, you can test new operating systems or try out new software without risk. The VMware Player is available for free, allowing you to import backup images or share data.

Microsoft's free Virtual Server and Virtual PC (search at microsoft.com) allow you to test virtualization and try out the company's Silverlight virtualization tool.

Parallels is one of the better-known Mac-friendly solutions. Parallels software runs on Windows and Linux hosts, as well as on Macs with its Parallels Desktop for Mac product. (VMware has followed suit and now offers a Mac app, too.) Parallels offers desktop, server, and automation virtualization packages with pricing that's more affordable than VMware.

If you'd rather go the open-source route, FreeVPS is a viable alternative to the commercial software listed above. As with some other open-source software products, FreeVPS doesn't provide official support, but full documentation is available on the Web site.

While the economy may be uncertain, a combination of free software, free services, and a bit of savvy can help any business rein in tech costs.