Key to evaluating products

All too often people think evaluating/comparing products means “what do I need right now,” or “what is the cheapest price?”  That isn’t necessarily true.  If you’re buying a workstation asset depreciation value is about 2 years.  After 2 years that system will be so outdated that you will likely want to cycle it out and get something new.  Since workstations are typically considered an unavoidable expense rather than an investment its best practice to get whatever is going to fit the mold of your business at that point in time.  Servers, Network Equipment, Cameras, Storage, etc – these are all long term investments.  You need to decide what an appropriate life cycle would be for this equipment.

When comparing/evaluating products the following things need to be taken into consideration

1)    Business needs – What are the short term/long term business needs of the product?
    a.    Demand
    b.    Productivity/Workflow impact
    c.    Hardware requirements

2)    Product Lifecycle – How long am I going to really use this product for?
    a.    Scalability, Upgradeability -- does it make good business sense to upgrade it in the future vs replace?
    b.    What are the average ongoing reoccurring costs for this equipment and when does it become counterproductive to support it?

3)    Manageability
    a.    Can I manage the product centrally or remotely?
    b.    Is the hardware boilerplate/similar to others that I buy?

4)    ROI
    a.    How many sales is it going to take to pay for the capital expense of this equipment?
    b.    What is the long term overall impact to the bottom line.

Spending money on hardware/software is cash flow.  It’s important to understand what the impact that cash flow is going to have on the greater business.  Certainly there is a threshold that varies for each business and product, but the fundamentals are still the same.