OPEX or CAPEX for your IT Investment? | TOUGHBOOK Blog - 0 views
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The “as-a-service” approach also has other benefits when it comes to flexibility. It’s much easier for a business to scale up and down as required. For example, adding new devices and services on a monthly basis or removing them. This flexibility ensures the business only pays for what it needs at the time, rather than having additional tech that is no longer required gathering dust in the warehouse.
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nixalexa on 19 Oct 21This approach is more beneficial for smaller companies, as many times they do not have the money to invest in these capital expenditures all upfront. This article explained the relation between Capital Expenditures vs Operational Expenditures as it relates to technology. This article explained how more companies have been taking the operational approach versus the capital approach because technology does not last forever. Almost every 3-5 years companies have to change their technology to stay up-to-date and efficient with their software and devices. Capital expenditures require all of the money upfront while operational expenditures is money spent as it comes in, like utilities, rent and other monthly or quarterly services.
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Traditionally, if a business wanted to invest in IT equipment, such as new laptops or PCs, they would pay for their technology upfront as a capital expenditure (CAPEX).