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REFURBISH OR PURCHASE COMPUTERS

Our computer systems need an upgrade to better serve associates, as the current setup is five years old. We are considering options: purchasing all-new HP workstations with modern programs or retaining the old systems with necessary upgrades. Costs involve new hardware, installation, software maintenance, and long-term technical support. The new workstations have a higher upfront cost but come with extensive warranties and support, while upgrading presents ongoing maintenance challenges. We need your input on the best decision moving forward.

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REFURBISH OR PURCHASE COMPUTERS

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  1. REFURBISH OR PURCHASE COMPUTERS GROUP #8 • SILVA ISAYAN-ORGANIZER • GERODO CISNEROS -SUMMARIZER • MARLON ORTIZ- TECH • JONATHAN LOW- TECH

  2. XYZ GRAPHICS DESIGN • WE NEED TO UPDATE OUR COMPUTER SYSTEM IN ORDER TO SERVE OUR ASSOCIATES MORE EFFECTIVELY. OUR CURRENT SYSTEM IS ABOUT 5 YEARS OLD. WE LOOKING FOR MULTIPROCESSOR SYSTEM WITH AT LEAST 2GB MEMORY.

  3. OPTIONS • BUY ALL NEW COMPUTERS WHICH COME WITH UP TO DATE PROGRAMS THAT WE NEED • KEEP THE OLD COMPUTERS AND INSTALL ALL THE PROGRAMS WHICH WE NEED.

  4. Technical Specs

  5. COST • COST OF NEW COMPUTERS HP Workstation

  6. COST • COST OF PROGRAMS TO BE INSTALLED • HARDWARE • SOFTWARE

  7. MAINTENANCE • COST OF LABOR FOR INSTALLATION FOR THE UPGRADE = $8,400.00 • ( which is 336 per unit) • COST OF INSTALLATION FOR THE HP WORK STATION = $0.00 • WARRANTY ( product and service) • Workstation has 6yrs warranty. • Parts for the upgrade have Limited Warranty. (which include manufacturing problems only.) • COST OF TECHNICAL SUPPORT • HP Workstation • comes with 6yrs of support ( online and telephone services) • Last year will have a $199p/m maintenance fee = $2,388.00 • Upgrade Option • $199p/m flat fee technical support for all 7 years= $16,716.00

  8. Present Worth of HP Workstation PWC = 52441.57

  9. Present Worth of Upgrade PWC = 50253.33

  10. Difference

  11. Sensitivity Analysis for New HP Workstation

  12. Sensitivity Analysis for Upgrade

  13. Observations • With a lower down Payment the Present Worth of each Option Decreases. But there is a much larger increase in the amount in the payments. • A very large distinguisher between both options was the Maintenance fee. • The price of the new workstation is very high • The cost of maintenance of the upgrade option makes it more expensive then the Workstation.

  14. Buying or Upgrading • There is a more probable chance in buying new computers for a company due to the hassle of maintenance, and its expenses

  15. Upgrading Problems • Hire engineers to upgrade • Buy the pieces (software and hardware ext.) • Training for employees • Extra unknown problems

  16. Decision • What do you guys think we should do? I think we should buy new workstation.

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