Why is my work computer so expensive!?

I can understand why it can sometimes be confusing to get a quote for a business computer (be it laptop or desktop) because the pricing never seems to line up with what the big box stores are advertising. A new laptop? Future shop is selling them for $500, so why does a “Business Class” version cost $2000? There is no one single factor that contributes to the large price difference but rather a collection of small differences that all add up when put together.

One of the first things to take into consideration is the manufacturer and hardware specs. of the computer in question. As I’m sure you’re aware, a fully loaded MAC laptop won’t perform the same as a lower end Acer or HP laptop. All the different vendors have their strengths and weaknesses and there isn’t necessarily a wrong choice, a lot of it comes down to personal experience and preference.

In terms of cost, they can all vary widely depending on the model and specifications but I’d put them in this order from most to least expensive as a whole:

1- Apple
2- Dell
3- IBM
4- Toshiba
5- HP / Compaq
6- Acer

There are other vendors but I’d consider these the major players that you’d see most frequently. To get back to the point of comparing the big box pricing to business class pricing, you can’t necessarily compare a Dell to an Acer directly. One of the main reasons for this leads me to my next point to consider: the warranty.

When your computer works fine, all is well, but when it breaks for whatever reason it can completely paralyze your productivity. The manufacturer warranty adds to the point of sale price on all computers they just don’t itemize exactly what you’re paying for it. When you buy a computer from a big box store the majority of the time you are getting a 1 year warranty that involves you packing up your computer and shipping it out to a remote service center when it breaks. (Yes, I did say WHEN it breaks, not IF, it’s only a matter of time.) Typically you’ll get your laptop back anywhere from one to four weeks later. Not to mention you still have to call support, open a case, go through troubleshooting over the phone, etc. before they’ll even let you ship your computer to them. The bottom line is that you can be without a computer for that long at home (I’m not saying it would be fun, but it could be done.). Work is a different story, you can’t just take away someone’s computer for a few weeks because the video card died, with the amount of money you’d waste in lost productivity you could probably buy two brand new computers.

For this reason, we decided to partner with Dell as a vendor for all business class computers. While Dell’s warranty does inflate the price of their systems substantially (usually by $300-$500) they cover the system for three years instead of one and you don’t need to ship out your computer for repair. You still need to go through the red tape (call support, open case, troubleshoot, etc.) but once they determine that something needs to be replaced Dell will come to you, and usually the very next day. A Dell technician will show up at your office and swap out any required parts right there in front of you.

So while it hurts to pay the price up front, you’ll thank yourself for paying it the very first time it breaks. 24 hours of downtime (usually less) instead of a few weeks.

Another reason why big box store computers tend to be less expensive is because of software. Ever notice that when you buy a new computer that it comes pre-loaded with a lot of garbage trial software? 30 days of anti-virus, 30 days of MS office, 30 days of the latest “game zone” membership, etc. All of which will want your credit card info once the timer runs out. All of these software vendors pay the computer manufactuerers a premium to ensure that their trial gets loaded on every system they sell. When someone like Acer agrees to have say 15-20 pieces of promotional software the back end cut they get for it can really add up. This in turn allows them to reduce their point of sale price to undercut their competition. All of this extra software can negatively impact the performance of your brand new system.

When was the last time you noticed a game zone trial on a brand new work computer? Even Dell isn’t immune to this behavior, thats why most manufacturers will have their different product lines. IE: Dell has Inspiron, Vostro, Latitude, Optiplex, Precision, etc. Toshiba has Satellite, Portege, Tecra, Qosmio, etc. Each product line has its own attributes such as low price point, high performance, home use, business use and the like. The Dell Inspiron line would be more for home and personal use while the Dell Optiplex line is for business users. This Optiplex line would be slightly more expensive beacuse they don’t include all of the above mentioned promotional software out of the box.

Also while on the subject of software, the version of Microsoft Windows and Office can also affect the price of a system. All of the big box stores sell the “Home” versions of Windows, which does not work in a business environment. (There are a few reasons for this but I think that would be a blog post on its own.) When you buy a “Business Class” computer you need to purchase the “Professional” version of Windows for it to work with the office network. And of course Microsoft makes the Pro versions more expensive than the Home counterparts.

In regards to MS Office, 90% of the big box computers will come with either MS Works, a watered down version of MS Office, or an MS Office Trial (or both as sad as that is). The license for Microsoft Office 2007 Professional alone costs more than the $500 laptop you can pick up at Best Buy. Most home users will either pirate Office (say it isn’t so!) or buy the student / teacher edition which is about one third the cost of a new Office 2007 Pro license. Most quotes that we provide to customers will include the cost for the MS Office licensing, which can easilly add $500-$600 to the final figure. (Can’t get much work done without Outlook, Word and Excel right?)

Hmm, I feel as though I’ve been rambling for a while now, time to sum things up:

My original goal was to try and shed some light as to why there is such a large gap in the cost of big box store computers vs business class computers.

1- The make / model of the computer matters. A Dell Latitude laptop doesn’t stack up eye to eye with an Acer Aspire laptop.
2- The Warranty: 1 year vs. 3 years, you shipping the unit out vs. the technician coming to you.
3- Pre-loaded trial and promotional software reduces the cost (and performance) of a new computer.
4- Windows Home edition is less expensive than Windows Professional edition.
5- Fully licensed MS Office is a costly necessity.

While there are definitely other factors that contribute to the cost difference I feel that these are some of the larger ones. And besides, this blog post is long winded as is, if I try to go on any longer I’m sure I’ll lose the few readers that made it this far in 🙂

-Al Lefebvre

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