Many small companies don't spend a lot of time agonizing over decisions about buying PCs anymore. As important as computers are, most SMB owners view them as a commodity items and buying them's pretty much a no-brainer.
It's easy enough to go over to a Circuit City or Best Buy and pick up a PC from HP, IBM or some other familiar-sounding name or surf to a Dell or Gateway site and buy online. Maybe you watch for specials to make sure that you get a good deal. The details of the configuration aren't that crucial. The important thing is to get something new and powerful enough to serve your needs for awhile and to get it from a name you trust.
For many businesses, this may be an adequate way to shop for PCs. It may even be the best way. It's not the only way, however. Many savvy small businesses forego brand names and big retailers and buy so-called "white box" PCs, or non-brand-name products usually made to order and sold by small local or regional suppliers that advertise in local media and Yellow Pages.
A tiny minority of small businesses, those that happen to have a PC aficionado on staff, may even build their own white box PCs, purchasing components from retailers or online resellers and assembling them according to instructions supplied with the parts or from build-it-yourself books or Web sites.
Why Buy a White Box PC?
We asked this question of small business computing consultant Richard Morochove, president of Toronto-based Morochove & Associates. Morochove helps small-and medium-size companies develop land implement long-term computing strategies. The process eventually involves deciding what kind of hardware to buy.
He cites three potential advantages to buying white box rather than brand name PCs: configuration flexibility, price and service. But they are only potential advantages, Morochove stresses. Not all white box products offer these benefits and not all small business buyers need them.
"You start with the technical specifications," Morochove says of the hardware selection process. "What processor do you need, how much memory and what size hard drive to support the applications you want to run? Do you need any non-standard peripherals a flash memory card slot, for example? Then you look at what sort of machine to buy. Are we going to get a brand name an HP or Dell or a white box?"
He puts his finger on one of the key advantages of buying white box the ability to specify very precisely which components go into the PC, including non-standard items. Retailers selling brand name products offer a few very standard configurations. In most cases you don't know which parts they're using, and they may not be the best. Dell offers more flexibility. White box suppliers typically offer unlimited configuration flexibility.
"To use a restaurant analogy," Morochove said, "buying a white box PC is like selecting from an a la carte menu rather than buying the special of the day."
Special Orders Don't Upset Us
Not only can you specify the exact components and capacities this much memory, that size hard drive you can also specify which brands. You can argue that the brand name on the component is more important than the brand name on the PC, that the quality and performance of the individual parts is what determines the overall quality and performance of the PC.
While building my own PC, I enjoyed choosing what I considered to be the best components. I started with a solid foundation: an Intel motherboard and super-fast 3.4 GHz Pentium 4 processor with Hyper-Threading (HT) technology. (HT enhances computer performance when you're multi-tasking, something more and more small business owners like me have to do.)
Then I cherry-picked the best of the best big, fast hard drives from Maxtor and Western Digital, the fastest DDR2 RAM from Kingston, a top-rated DVD1R/RW optical drive from Plextor, the latest all-in-one graphics card from video king ATI, a sound card from perennial market leader Creative Labs, and so on. I even shopped carefully for the case and power supply, opting in the end for products from Antec that offered the best cooling and low-noise features.
Not many very small business owners are anything near as finicky as I am, Morochove says. But slightly larger businesses that have their own computer manager often have clear ideas about which component brands they want to use. In some cases, he implied, these preferences are merely prejudices about the quality of one brand versus another. But Morochove points out there is another benefit to hand-picking components.
"[Information technology] guys often want to specify that the PC supplier use only Western Digital hard drives, for example, because it makes it easier to manage the PCs," he explained. "This way, you know you have Western Digital in on all your boxes. You can have spares on hand, and if one fails, you can do a quick and dirty swap, without worrying about software or compatibility. The maintenance issue is usually the primary driver for requesting specific components brands."
Depending on your circumstance, configuration flexibility may or may not be important. If you're ordering a significant number of PCs, maintenance could be an important factor. If you have strong convictions about or experience with quality differences from one brand to another, you'll want to be able to specify. Building PCs to order is also a good idea if you have special requirements a Gigabit Ethernet network interface card rather than the more standard 100 Mbps, for example, or an IEEE 1394 (Firewire) port for connecting a digital camera or camcorder. Otherwise, it may not be acrucial advantage.
The Price is Right Or is It?
Price is clearly important to every small business. Are white box PCs any cheaper? It's worth remembering that big PC makers buy components in volume and get better prices than your small local white box supplier. Many of those PC companies also assemble their products off shore where labor is cheaper. On the other hand, they may also take a larger profit.
It's difficult or impossible to do apples-to-apples comparisons between white box products and pre-configured brand name PCs because you don't know what's inside the brand name product. It also depends on which components you use in your white box PC. If you insist on expensive brand name parts because you think they'll provide better performance and longevity, you will likely end up paying more than you would for a comparable brand name model. Of course, you'll theoretically also get a better PC.
"Typically the price of the white box PC is equal to or less than an equivalent brand name product," Morochove says. "More often less."
One factor swings the pricing balance in favor of the brand name product, though, he added. PCs from Dell, HP and others usually include some bundled software. At the very least, they pre-install the operating system. With white box PCs from a small, local supplier, you generally pay for all the software, including the operating system.
Brand name makers sometimes claim their software bundles are worth as much as $500, while adding nothing to the cost of the PC. It may be true that buying the same software separately would cost that much, but this can be misleading, Morochove points out.
"Some people think brand name products are better value once you include the value of the bundled software," he said. "But if you value the software at zero because you'll never get any use from it, then you're probably a good candidate for a white box PC."
There is one other often overlooked cost consideration that applies when you're replacing an existing PC. The keyboard and mouse, the monitor and other external peripherals or even internal parts on your existing PC may be perfectly adequate, especially if you upgrade your PCs fairly frequently. If you buy a pre-configured brand name PC, those parts are included whether you need them or not, and contribute to the overall cost. If you buy a white box PC, you can buy only what you need.
Lean On Me
The other huge consideration for most small business owners is after-sales support. Can you get good help when you need it? It depends.
On the one hand, the white box PC maker is usually local. He knows exactly which PCs you have and what's inside them. Compared to large retailers and brand name computer makers, he has a very few clients, of which you are now one. This should mean he values you very highly and all of this should translate to better service.
"If you buy a machine from Dell and phone its support line, you're apt to be switched to somebody in Bangalore, India who doesn't know you or your PCs," Morochove pointed out. "With most white box PCs, people relatively close at hand handle the assembly, and depending on the relationship you develop with them, you might get better support."
On the other hand, he said, for very small businesses with no in-house computer expertise, being able to call a toll-free support line and have somebody trained in dealing with non-technical users talk them through a problem may be of greater value. Also, white box suppliers, because they typically cater to businesses, often keep regular nine-to-five hours. Will there be somebody there after hours to help you? Possibly not.
"If your own business only runs during regular business hours, that's fine," Morochove said. "You'll probably be able to get all the support you need from the white box supplier. Otherwise, it's something to consider."
Another consideration is the company's longevity. It may be there to help you tomorrow, but will it be there a year from now?
"If you buy from a known company like a Dell you know it's going to be around in a year or two, and that you'll be able to reach someone to get support," Morochove said. "If the white box supplier has just started up and has no track record, you're taking a real risk."
That said, lots of white box PC makers have good track records, and you can count on them being around for the long haul. In the mid-size city where I live, two or three have been in business five or more years, at least one for more than 15.
Are white box PCs for you? If you want or need control over what's inside your PCs, if you don't need the software or some of the peripherals included with brand name products and you can find a local white box supplier who will be able to provide the technical support you need, then yes. You'll get a PC better-suited to your needs, probably at a lower price. Otherwise, think twice.
Based in London, Canada, Gerry Blackwell has been writing about information technology and telecommunications for a variety of print and online publications since the 1980s. Just for fun, he also authors features and columns on digital photography for Here's How, a spiffy new Canadian consumer technology magazine.
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