A BUYER'S GUIDE TO NAME BRAND VERSUS WHITE BOX PCS

Computers capable of running Windows or Linux have become commodity items both on the desktop and in the server room. There are many well-known and some not so well-known distributors of such systems. Is it safe to buy locally branded PCs or should you stay with a name brand?

Computers look somewhat different but what matters is inside. The name brands like Dell, HP and Gateway don't manufacture processor or memory chips. Nor do they make disk drives, LCD displays, keyboards or power supplies. All those items are purchased from external suppliers and packaged into PC products.

Many small, local suppliers of computer systems purchase the same components used by the name brands and build PCs from them. These are often referred to as "white box" PCs. A white-box computer is usually a low-volume computer built with name-brand components.

So what makes one vendor's products different from another?

Clearly there are many factors that influence the selection of a computer system. Assuming the hardware is pretty much the same, attention turns toward price, delivery, service, reliability, and add-ons. Let's examine each of these.

Price is always a factor in any purchase decision. Years ago, the white-box vendors had a price advantage over name brands simply due to lower overhead. The price advantage has largely been negated by high-volume, lean-manufacturing operations such as Dell. While Dell has a higher overhead than the small players, it also has the ability to negotiate deep discounts on components.

If you want to purchase hundreds of standard systems configured exactly alike, the name brand vendors can offer a better price. (Buyer beware: Vendors will purchase components such as memory and disk drives from multiple suppliers. When buying in volume, you will receive systems that are functionally identical though components may not be interchangeable.) If you want a small number of systems designed to your specifications, the white-box vendors can often provider better pricing.

When it comes to delivery times, there are no clear differences. Both types of vendors have systems available on a cash and carry basis as long as you'll accept standard configurations in low volumes. Once you request anything out of the ordinary or in high volume, lead times become an issue. As above, the larger vendors can deliver large orders faster while the small vendors can often deliver small orders faster.

Service varies greatly from vendor to vendor and even region to region. The name-brand vendors have massive support networks and follow a strict escalation process. Your call may be routed to an overseas support facility and you may find it difficult to get the service you expect. If you require onsite service, you'll need to call a central number and follow a sequence of steps before someone will agree to visit your location.

If you buy a white-box PC from a local supplier, your service call is likely to be answered by the support technician who built your machine. He will be intimately familiar with your system configuration and will often be able to provide immediate assistance. Obviously, you need to inquire about support services before making the purchase decision. (Buyer beware: Providing support during non-business hours may be a problem for small vendors.)

Because the system components are largely the same, one might conclude that reliability is also the same. Unfortunately, this is not the case. Most components are designed to operate under controlled conditions. For example, clock speed, temperature, power consumption and electrical noise must be tightly controlled. When components are not properly matched, premature failure is the result.

Regardless of the type of system or the purchase location, it is best to purchase configurations that have been available for at least a few months. This gives the supplier time to obtain feedback from customers and make alterations if needed. Also pay attention to warrantee terms and conditions.

Lastly, add-ons vary widely. Vendors will throw in all kinds of hardware and software items to sway your purchase decisions. These items include displays (LCD or CRT), printers, digital cameras, anti-virus software, office applications, image editors, video editors, etc. The major vendors frequently conduct promotions though they are usually targeted at consumers not corporate buyers.

Smaller vendors tend not to offer these incentives routinely however everything is negotiable. Talk to a manager of the business, or even the owner, and you will likely be able to get something of value added to your purchase at little or no cost. The more systems you purchase, the better your negotiating position.

So where does this analysis lead you? Should you buy a white-box PC? There is no simple yes/no answer but here is a summary of the major factors.

Reasons to buy from a name-brand supplier:

1) Better pricing on large volume, standard configurations

2) Ability to deliver large volume purchases more quickly

3) Ability to service multiple locations around the country or the world

Reasons to buy from a white-box supplier:

1) Better pricing on non-standard configurations

2) Ability of local vendors to supply personal service

3) Ability to customize systems to your exact specifications

Major purchase decisions are never easy but now you are armed with enough information to make an informed decision. Give your local computer vendor a chance to win your business the next time you need to purchase a system or two. You may be pleasantly surprised by the value and quality of service.

Vin D'Amico is Founder and President of DAMICON, your ADJUNCT CIO™. He is an expert in leveraging open software to drive growth. DAMICON provides Freelance Technical Writing, IT Disaster Response Planning, and Network Security Management services to firms throughout New England.

This article appeared in Vin's monthly Virtual Business column for the IndUS Business Journal in May 2005.

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