This post is intended for small business owners that need to minimize the cost of a name brand server. I typically deal with HP and Dell servers, so the information here applies specifically to purchases from those two companies, but it may apply equally well to other brands. These tips can save you a lot of money, but they will sometimes come at a convenience cost which has been noted where appropriate. Some of these tips assume that you have a fairly high level of knowledge of hardware and the computer industry, so if you find yourself lost in the terminology or techniques, contact us at www.bastionpoint.com. A good consultant can help you find your way to picking an appropriate server at the best price.
Shop smart!
The most important money saving tip is to buy the right server for your needs now and the near future. I believe too much emphasis is put on purchasing a server that will not become obsolete. Obsolescence is unavoidable and with processors, RAM, hard drives, and controller technologies improving so fast and prices dropping so frequently, overspending on a server is almost guaranteed if you try to beat the obsolescence curve. New OS choices and new server applications compound the problem. The other factor to consider is how frequently small business needs change.
Always try to take advantage of specials from HP and Dell when purchasing a server. Check to see what specials are currently available from Dell, and check to see what HP is offering as Smart Buys. Dell’s specials change frequently, so if the current special does not save you money on the configuration you need, see when the current special expires and check back. HP Smart Buys are configurations that HP anticipates will be popular and they are often heavily discounted. HP specials change less frequently than Dell, but HP also makes their expiration public. Check back if the current Smart Buys do not fit your needs and you can wait to make your purchase. Additional RAM, drives, and other components for Smart Buys tend to be pricy, but there are other options available to offset that problem. I address them later in this post.
Don’t narrow your server search to a particular model. Determine what your hardware requirements are and then browse HP and Dell to see what model generally fits your needs. Check the model priced directly above the one you think is best and see if a special makes it more cost effective. For example, if you add a bunch of components to an HP DL350, the price can really rise quickly. Check to see if there is a Smart Buy DL370 configuration that is close to what you need without having to add as many components. You might be able to get a more powerful server for about the same price as the DL350. Dell will sometimes run specials that discount your purchase based on price. You might see a special that gives you $500 off a server priced $2000 or more, and $1500 off a server priced $4000 or more. If your ideal configuration comes to $3000 (-$500 discount) for a total of $2500, you can add upgrades until price is $4000 (-$1500 discount) and get a much better server for the same $2500 total.
Purchase through the appropriate channel! The old adage of never buy retail holds true for server and PC purchases. HP’s best purchasing option is through an HP authorized reseller. A good reseller will have several distributors that they can source product from to get the best price. Distributors usually carry a good quantity of HP product in stock, so your order can often arrive the next business day with little to no shipping charge. I personally prefer the quality of HP’s business products to Dell, the purchasing process is easier, and HP treats their resellers like partners. HP has been very aggressive with their pricing and I have been pleasantly surprised to find that HP will often beat Dell’s pricing on comparable equipment.
Dell’s primary business model has been selling direct to consumers but they are branching into retail sales and offering products through distributors. If you choose Dell, I still think that buying direct from Dell is still the best option. If you make several purchases a year from Dell it is very beneficial to cultivate a relationship with your sales rep. You can get very attractive unadvertised pricing from Dell if you deal with a sales rep. Margins for Dell resellers are typically very low, so purchasing from a consultant that resells Dell equipment may not be your best option, but I don’t discourage it out of hand. If you deal with a consultant, see what their pricing is and if you can beat it by purchasing direct from Dell, work with your consultant to make sure you get good value for your expense. If a client prefers Dell equipment, I typically get a rough quote from Dell. With the client’s approval, I will bill the client an hour or two to finish shopping for the best price and help them purchase their equipment direct from Dell.
If your organization is a church or other charitable organization, it may qualify for Microsoft Charity licenses. Charitable organizations must be qualified §501(c)(3) organizations as defined by the United States Internal Revenue Code. Some exceptions apply. These licenses are drastically cheaper than retail prices, often 70 or 80 percent less than retail! You will have to contact a Microsoft reseller that is authorized to sell charity licenses, but it is well worth the effort. I recommend purchasing your new server with no operating system and getting your server software through Microsoft’s charity program. You can also purchase HP or Dell PC’s with no OS or free Linux and load those computers with Windows XP or Vista charity licenses to save hundreds, even thousands of dollars on Microsoft desktop software.
Schools and other academic institutions may qualify for deeply discounted Microsoft Academic software licenses. These are very similar to charitable licenses and must be purchased through a Microsoft authorized academic license reseller.
If your organization is a small accounting firm, I recommend becoming a registered member of Microsoft’s Professional Accountant Network. As a member you can subscribe to Microsoft’s Action Pack for $299 per year. The Action Pack includes a Windows Server license, SQL Server license, 10 Microsoft Office Professional licenses, 10 Microsoft Office Accounting Professional licenses, and licenses for other Microsoft programs for internal use in your company. The Action Pack is only available for accounting practices and professionals that provide services to outside clients. If your business is selling widgets or servicing air conditioners, your accounting department does not qualify for membership or the Action Pack. Action Pack licenses cannot be resold and you cannot receive more than one Action Pack per company. As with charity licenses, I recommend purchasing a server and PC’s with no OS or free Linux and using your Action Pack licenses to save thousands of dollars.
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