Your Technology Expenses Aren’t All the Same

When budgeting capital for your company’s technology, it isn’t always simple to know how much to allocate. In fact, a lot of times it can be a convoluted and troublesome experience. Our consultants spend quite a bit of time and effort working out workable budgets for our clients and today, we thought we would talk about how we come about our figures to comprehensively support a business’ technology.

Our typical roadmap splits IT expenses into two categories: operational expenses and projects.

Operational Expenses

A business’ operational, or ongoing, expenses typically include those that they have paid every month to keep the business running. This includes hardware and software costs, utilities, payroll and other fixed recurring expenses. If you want to get a handle on it we recommend that you audit these expenses quarterly so that you can keep track of what you are spending, and not wasting capital on antiquated expenses. 

Project Expenses

A business’ projects are typically short bursts of capital outlay to remedy a problem or improve your business’ offering. In fact, anything that isn’t a recurring operational expense is probably such a cost. This happens when you need to outlay capital for hardware (physical or in the cloud), software, and expenses that aren’t regular to your business.

In general, the more operating expenses you have for your business’ IT resources, the more predictable and manageable your technology expenses will be. If you are spending a lot of capital on projects with the notion that they will somehow turn into operational costs, you are probably clutching at straws. 

The IT professionals at Ferrum Technology Services can break down all types of technology spending, making it clear what costs are mandatory and which ones are actually optional. The better you understand your technology spending, the easier it will be to make decisions about technology and how it fits into your business’ long-term goals. 

If you want to learn more about tightening up your technology budget for 2022, give us a call today at (847) 697-3282.