How Paying for Value-as-Consumed Aids SMBs

According to the U.S. Small Business Administration, lack of capital is the second most common reason that businesses fail, right behind the lack of experience of business owners. Without that capital, SMBs can’t purchase the essential hardware and software they need to start up and maintain their businesses.

Equipment leases seemed to be one solution to this problem. Having multiple small payments spread out over time was more appealing to SMBs when compared to having to shell out one large lump sum. But leases weren’t designed to scale to meet a company’s needs. If a business owner bought more computers or other equipment than the business revenue could support, even on a payment plan, the cash would eventually run out. On the other hand, if the business owner didn’t buy enough equipment to meet customer demand, the company would never reach its potential.

Another issue was that equipment leases had nothing to do with the software, security, and other applications needed to run a business, which could result in high initial expenses before the business even generates any revenue. Furthermore, all of those applications had to be installed on every on-premises and remote device, a time-consuming and cumbersome proposition, particularly as many SMBs cut back or totally eliminated IT staffs in the last economic downturn.

The advent of the cloud has changed all of that.

The cloud enables SMBs to shift pay for their IT expenses incrementally like a lease but via a model that grows along with the business. As such, it enables the SMB to invest available capital for other needs (e.g., inventory, personnel) that drive revenue and growth. As the business and its technology needs grow, the SMB can pay for additional IT needs from operating revenue rather than incurring debt, which can be expensive.

By taking advantage of this IT-as-a-Service (ITaaS) model, an SMB no longer has to be concerned with ongoing maintenance charges related to on-premises IT nor with the unpredictability of IT needs or IT changes, like the growth of a new social media platform that has to be incorporated into a legacy CRM application. A cloud-based application can continually be updated to include new social media integration and other features as they become available.

In this new ITaaS environment, each SMB, working with a trusted managed services provider, can add the technology it needs, as it needs it. So the SMB can have access to word processing, accounting, security, pdf reader, Web browsing and hundreds of other applications as well as computer processing, data storage, etc., on an as-consumed basis, providing each SMB with its own customizable, click-together IT solution.

The ITaaS model also provides SMBs with the efficiencies and power of the latest technology offerings. So, as it grows, an SMB isn’t saddled with applications and processing power that ceases to meet the business needs. The applications and data are maintained in the cloud, so they remain up to date and secure without the need to constantly install upgrades, patches, or purchase newer versions.

For more information on the benefits SMBs can derive by shifting IT resources to the cloud, go to https://secaas.sonicwall.com/.