It’s a pretty simple question: How much should a small business spend on IT? The question is so basic that I was sure there was a concrete number. To find out, I did what anyone presented with a tough question would do. I Googled it.
Most data I found was focused on the small and midsized business (SMB). The SMB market is defined as companies with 250 employees or fewer. But I was interested in budgets for even smaller-sized companies, those with 10 to 100 employees. It turns out that collecting information for that sized company is much harder.
I did find an article on ZDNet from October 2014 discussing IT budgeting in 2015. It refers to 2014 findings that the average IT expenditure for companies with fewer than 20 employees is $2,770 per employee. This means that if you have an average of 10 employees you should expect to spend $27,700 per year on IT. Is that close to what you’re spending now?
To the average Southeastern North Carolina business owner with 10 employees, I expect that number seems high. But you may be surprised when I say that it isn’t far off the mark. Keep in mind that this includes hardware, software, support, Internet service, technology training and other specifics.
To know what your true technology expenditure per employee is, or should be, you must start with a true accounting of the technology needs in your company.
Traditionally, we see spikes in expenditures when hardware has to be replaced or when software has to be upgraded. These expenses can sometimes be anticipated, but sometimes not. Examples might be a failed server or software that is no longer supported. These types of expenses can present challenges to developing an accurate budget.
One way to circumvent these problems is to take advantage of cloud-based technology. Backups, anti-virus, email, SPAM filtering and more can all be offered through these services. Additionally, a cloud service prevents companies from having to worry about renewals.
A remote hosted server can also eliminate the need for local servers and can, again, help you cement a monthly cost per employee. But, most importantly, you won’t have to worry about a large unplanned expenditure if a sever fails. All of this means that you can get a more accurate estimate of your actual technology cost per employee.
While I wish there was a set cost that everyone could use in planning their IT budgets, the reality is you have to find what’s right for your company.
Working with a professional IT company would be a great first step to get in front of your business’s technology needs. Being reactive always costs more than a preventative approach. Don’t let unanticipated moments hit your IT budget. With a little planning, and knowing when to invest in cloud-based services for long-term savings, you can control your company’s IT cost per employee more than you think.
There’s a reason why so many organizations look to Atlantic Computer Services for the IT support they need to grow their business, and that’s because ACS provides honest, reliable, knowledgeable and friendly service. The company's goal is to serve as a technology partner, offering solutions that are affordable, uncomplicated and in the best interest of each individual client. Learn more about ACS, its services and its people at www.acs-ilm.com, or call 910-799-6538.
Audrey Elsberry - Sep 22, 2023
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