Appreciating and depreciating assets
The logic of a business investing in an asset that appreciates, such as the freehold of its premises is reasonably straightforward. Over time, the asset grows in value and providing it was able to purchase it outright in the first place, or meet the terms and stick to the repayment schedule for any loans, it should realise a significant Return On Investment (ROI) when it is sold on.
An asset like a car, which depreciates is subject to number of different factors that erode its value; mileage causes wear and tear to powertrain and is reflected in the condition of the body and interior. Changing technology, taxes related to fuel type and consumption, and manufacturer’s warranty are just some of the factors that influence re-sale value.
Depreciating business technology
It is a similar situation when it comes to business technology. Technology development moves fast, rendering tech products obsolete and of negligible value in relatively short time frames. When a business owns technology assets funded through CAPEX, the period of tangible asset depreciation is based on the useful lifespan of the item, in this case the period which the business is expected to benefit from use of the asset.
For most business technology, including servers, storage and related infrastructure, hardware and software, the typical depreciation period to zero is usually 2 – 4 years. So, where a business invests £100k in its server infrastructure and writes it off over two years, the company needs to realise £50k of benefit each year. It may sometimes be difficult to establish whether ROI has been obtained.
Avoid tangible asset depreciation with HaaS from The Bunker
Businesses have long been attracted to leasing cars. Taxation has been used to shape behaviour and push employers and employees away from company cars. For employees taking a car allowance instead of a company vehicle, a personal contract purchase (PCP) is now the most popular option. Leasing and PCP both allows vehicles to be funded without the need to invest in outright purchase, often providing the opportunity to acquire higher spec vehicles for predictable monthly spend.
When it comes to provisioning business technology, Hardware as a Service (HaaS) offers similar benefits, allowing companies to retain access to essential services while avoiding the ownership, management and maintenance of the infrastructure.
Build on the benefits of Colocation
SMEs looking to eliminate on-premise server infrastructure can build on the benefits of a traditional Colocation service. HaaS provides the opportunity to offload responsibility for supply, installation and maintenance of server hardware, storage and network devices to The Bunker for a fixed and predictable monthly cost.
The key benefits of HaaS are:
- Get all the benefits of our Colocation service – Without the cost or complexity of maintaining hardware
- Minimum upfront costs – Eliminate large CAPEX investment and tangible asset depreciation that goes with it to take a cleaner, clearer and more straightforward approach to technology financing
- Total peace of mind – No more stress worrying about end of life hardware breaking and liaising with hardware vendors; why get up at 3AM to respond to an alert when we’re already here?
- Retain control of software – Complete control of server-side software for in-house teams developing and integrating software platforms and system
- Focus on your core business – Waste less management time and get more value from your expensive IT resource by focusing them on strategic and customer-centric core business activities
HaaS is part of The Bunker’s service stack.
The stack is a family of outsourced services that progressively enable a business to untangle itself of the responsibility for provisioning, managing and maintaining server-side technology.
You don’t run an IT infrastructure services company, so stop spending so much time managing IT infrastructure.
To find out more about how you can get started with HaaS, speak with one of our infrastructure experts today on 01304 814800.