Spending Wisely on Technology | Black People In Business - World ...

When Corrie Wilder got laid off from a large magazine publisher in 2008, she figured she could keep working in her field by launching a graphic-design business out of her home.

There was just one problem: The hardware and software she was accustomed to using was no longer at her disposal, requiring her to buy similar technology of her own.

Hal Mayforth

?It kept me up at night,? says Ms. Wilder, 40, of Seattle. ?It was an investment I wasn?t prepared to make.?

For people used to working in an office stocked with various tech tools and gadgets, starting up a solo enterprise may mean having to face a painful reality. From computers and high-speed Internet to off-the-shelf software and customized programs, technology is often a pricey prerequisite for getting a new business up and running.

?You don?t have to get the latest and greatest, but you don?t want to buy the cheapest products either,? says Ramon Ray, editor of tech website Smallbiztechnology.com.

Choosing the right kind of hardware and software can be tough, especially if you?re limited to a shoestring budget. Entrepreneurs typically must consider how tech-savvy they are, whether different products and brands can interact with one another and what the future of the company might demand, among other factors.

?You want to make sure the technology you buy will grow with you,? says Mr. Ray. For example, while you might not need a lot of memory on your computer in the beginning, having a significant amount of storage space may become critical down the road.

Heather Haddad learned this the hard way. After finishing graduate school in 2007, she launched Fum[eacute]e Cigars, a bricks-and-mortar and online retail business in Cedar Park, Texas. Though saddled with $200,000 in student loans, Ms. Haddad funded the venture by taking on even more debt, in the form of a $50,000 bank loan, $10,000 in credit-card charges and by borrowing from family.

One of Ms. Haddad?s first technology investments was an inventory-management system that cost her $300. She expected it to automatically remove items from her website as soon as they sold in her storefront ? an important task because she couldn?t afford to load up on inventory and wanted to avoid misleading customers about what she had available.

But Ms. Haddad soon discovered that the system couldn?t update information in real time, causing delays. What?s more, it stopped working when she upgraded the program her company website runs on, and the two items must be compatible. To resolve the problem, she found she would either have to spend another $300 on a different version of the inventory system ? or go back to using the older website program.

Ms. Haddad chose the latter to save money, and says, in hindsight, she should?ve put more effort into researching her options upfront.

By contrast, Krista L. Sherkey, owner of Streamline6 Communications, a public-relations and marketing agency in Honolulu, says a portable receipt scanner and related software she purchased upon starting her venture is meeting her needs and even helping her save. Whenever Ms. Sherkey incurs a business expense, she uses the scanner to make a digital copy of the receipt. A corresponding program then transfers the data from the receipt into a PDF file on her desktop that she can label.

The scanner and software, called NeatReceipts and NeatWorks, respectively, also can be used for copying and storing data from business cards, insurance forms, legal documents and more. Their combined retail cost is about $200. (Similar technologies include Shoeboxed, Expensify, ExpenseCloud and ScanDrop.)

Ms. Sherkey, 30, says she became her own boss in 2009 because she needed a job that she could perform from any location since her husband?s career requires the couple to frequently relocate. She says being able to compile digital copies of receipts for her business means she can easily analyze her expenses. Recently, she concluded that she had been spending too much taking clients out to lunch.

?I was doing it three or four times a week,? she says. ?Now I?m doing it three or four times a month.?

Reading product reviews, participating in tutorials and requesting referrals to other entrepreneurs who have used a particular technology are ways to find out if it?s likely to pay off.

Ms. Wilder, the graphic designer, says she took some of these steps before tapping her savings to buy a laptop computer costing $1,600 and a comprehensive design program for $2,700. She also says having to pay for these items herself prompted her to try to get the most out of what she bought for her start-up, which she named Design Solutions LI.

?It made me want to work a little harder to get those clients,? says Ms. Wilder, who admits at least one other piece of technology she bought early on ? a $100 software program for organizing her schedule ? proved unnecessary.

?If I could do things over,? she says, ?I would spend that $100 on something much more practical.?

?Email: sarah.needleman@wsj.com

Source: http://worldwide-nubians.org/spending-wisely-on-technology

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