[Quick note: This was originally written for SuccessMagazine.com, before the magazine's ownership changed. While this should be an accurate overview, it is not legal or professional advice and should not be taken as such.]

Introduction

It’s one thing to walk into a fully-equipped office, sit down at your desk and start working. It’s entirely different — and more difficult — to set up an office from an empty space. Whether you’re creating a home office in your spare room, or breaking ground on enough space for 15 employees, this Success guide can get you started.

Regardless of the size of your office, you will need a computer for each person who works there. Whether you choose a desktop or laptop depends on your price range, needs, and whether or not mobility is a requirement. Choose a section below to get started.

• Purchasing a Computer
• Home (One-Person) Office
• Two-Person Office
• Three-Plus Person Office
• Mistakes to Avoid

Purchasing a Computer

Hardware Requirements

The more you plan to do with your computer, the more built in bells and whistles it will require. Business office functions, such as e-mail, Internet access, word processing, spreadsheets, and presentations can all be done with a fairly basic machine, either a desktop or laptop. However, if your business has more complex needs, such as Customer Relationship Management (CRM), inventory, POS, automated backup of data, or graphics-intensive programs — you’ll need to be sure the machines you purchase are up to the task. You’ll want to evaluate any potential purchase of hardware using these criteria:

RAM: Stands for Random Access Memory. RAM is what accesses the information on your computer’s hard drive. For the most part, the more RAM you have, the faster you can open, quit, and switch applications. Most computers can handle basic office needs with a minimum of 128 MB RAM, though 256 MB is preferable. For more intensive applications, such as CRM or e-commerce programs, you will want at least 1 GB RAM. However, if you plan to run Windows Vista on your computer, the minimum required RAM is 512 MB, but 1.5 GB is preferable.

Processor: The processor is the part of a computer that coordinates and controls the rest of the system. If you are only doing basic computing, you can use a processor with a speed of 400 or 500 MHz (such as an Intel Celeron M or Intel Pentium M). For more complex computing, look for 1066 MHz in a desktop or 667 MHz in a laptop (such as the Core 2 Duo processor).

Hard Drive: This is where all your information is stored. When it comes to a hard drive, the bigger, the better — especially if you’re storing multimedia files. You should invest in at least 30 gigs, even in a laptop, but 80 or 100 gigs is even better.

Special Considerations for Laptops

Although you’ll use many of the same criteria to evaluate the purchase of business desktops, there are additional points to keep in mind when shopping for your new laptops. Here are the most important.

Since you’ll be carrying a laptop around, you should consider its weight and balance it against your needs and the amount of carrying you will most likely be doing. If you do not need to run advanced graphics programs, you can find a laptop that is very small and lightweight — as little as two pounds. However, if you require a bigger screen to view graphics, you need additional processing power, or you need a super-tough laptop, you may have to trade off for a heavier weight; larger laptops run in the 8-10 pound range. These heavier laptops are great if you are traveling frequently or working in outdoor conditions. Some are designed so they can survive being dropped, stepped on, or even shot.

Another important factor when considering which laptop to purchase is battery life. If you know you will spend much of your time away from electrical outlets, make sure you have a long-lasting battery. Laptop batteries vary widely in the number of hours of power they can provide. You can purchase batteries with anywhere from four to ten hours of life per charge. Many heavy mobile users will purchase an extra battery and keep it charged and ready to avoid any downtime.

Finally, know what the warranty your laptop comes with will cover: some will only include coverage several specific types of damage, which may not include falls or spills; others may cover any and all damage.

Also Note

You should also consider how the hardware you purchase will effect your work environment and the people working in it.

For instance, some computer fans run quite loudly, others may be nearly silent. If you’ll be using the phone next to your computer, or if you’re sharing an office with someone who can’t be interrupted by computer noises, you’ll need to make sure your machine runs quietly. It’s surprising how much noise several computers running can actually generate, so if you will have multiple machines in one big workspace, noise is definitely a factor to consider.

There’s also the question of comfort. The more time you and your employees spend on the computer, the more you’ll need to worry about developing repetitive motion injuries such as carpal tunnel syndrome, which can make typing painful or nearly impossible. Getting a mouse with a trackball can help, and trackballs are the mouse of choice for most users who work with graphics programs. You may also try an ergonomic keyboard (shown above), which is designed to better fit the hand and wrist, and thus prevent strain. A keyboard rest is also a good option; these sit in front of the keyboard and assure that the wrists are in the most comfortable typing position. Ergonomic keyboards and rests take time to get used to, but are often more comfortable in the long run and are essential for workers who spend the large majority of their day typing.

Home (One-Person) Office

There are two components to setting up a home office right: the technology, and — sometimes more importantly — the physical layout of your office. Because home offices are often in converted bedrooms, basements, attics, or other small areas, space is always a concern.

Physical Layout

It may seem obvious, but be sure to carefully measure the space you have, and note where the windows and doors are located, before your purchase your home office furniture. Also track which direction your door swings, and how much room that takes up. You’ll need those measurements anyway when it comes time to file your taxes and take your home office deduction.

Actually putting together the physical placement of your office may be tricky. If your space is limited, you must figure out how to use every inch of it. This doesn’t only mean lining your office with filing cabinets or bookshelves, but also arranging it so the files (and devices) you need the most frequently are easily accessible, leaving the harder to reach areas for older data you do not need as often. If your home office is converted from a bedroom, use any closets that might be available. You can fit closets with shelves or filing cabinets, which can store the material you don’t need as often. You can even mount your phone on the wall rather than leaving it sitting on your desk.

Home office expert Jeff Zbar has two additional recommendations for home offices. The first is to make sure your phone has a headset and a mute button — two things which can come in very handy in a slightly chaotic home office. He also says to make sure your office has a door that can close, so that when you shut yourself inside, it’s business time, and when you shut it behind you, you know work is done for the day.

Technology

As you select a computer for your home office, think about your desk size. If you’re working in cramped quarters, consider getting a flat screen monitor. This will reduce the amount of desktop real estate your computer takes up. It also will generate less heat, which can be a problem if your space is small or not well ventilated. Furthermore, your computer’s tower should not be kept on your desk. It can often fit below or beside your desk instead, freeing up more space.

You’ll also need a printer, copier, scanner, and fax machine. Many printers now can do all four, and buying a four-in-one device can save you space. These machines can print, at their lowest quality, 30 pages of black and white text per minute or 20 pages per minute of color, and at their highest quality, 2.1 pages per minute of black and white and 5.7 pages of color per minute. When pricing your printer, factor in the cost of ink cartridges; average prices range between $30 and $50.

To stay connected with the outside world, you’ll need an Internet service provider (ISP) and a phone. Every office should have high-speed Internet (DSL and broadband) to be efficient, so make sure your ISP is not offering you dial-up service. As for your phone, using your home number could be sufficient, but if you take a large number of calls or you want to have a special answering machine message for your business, you will need a dedicated office number. You can use your cell phone for your business, but only if you get good reception and have plan that will be cost efficient.

Two-Person Office

Setting up an office for yourself and another coworker can be tricky because solutions for home offices no longer apply (you can’t simply use your home phone as a work phone), but you do net yet need the complex — and expensive — equipment that larger offices require. The key to putting together a two-person office is in finding solutions that are simple but can grow with your company, should they need to.

Sharing Data

Both workers in your office will need computers. The question becomes, how do you connect them? Luckily, with only two people, it’s easy — a cable between computers can create a network and allow them to share data, a printer, and other information as needed.

Another way to share data, as well as to transport files from your work to your home computer, is with a USB drive. These drives are small (some of them can hang from keychains) and plug into any standard USB port on your computer. They are relatively inexpensive and hold anywhere from 128 MB to several gigs. Moving files on and off these drives is quicker than putting them on a CD, and all information can be deleted and they can be reused. Similarly, you can use an external hard drive to either share or backup data.

Though USB drives and external hard drives are convenient and cheap, (average price is $100 – $200, depending on size) you may also consider getting a server and setting up a network through it. This can affect how you connect to the Internet; though you can work on a computer-to-computer network and be connected to the Internet separately, with this kind of network you’d need an Internet router to connect both of your computers to the Internet through the server. Though not necessary with only two people, this will help if you plan to expand your office to include more people down the line.

Phone Systems

With two people, you should consider a phone service such as GotVmail or another PBX service. These can give you a local or 1-800 number for your office, which will forward to existing phones (including cell phones, convenient if your work involves travel), and you can easily set up new extensions for any temporary workers. They also include services such as voicemail, automated messages, hold music, and other useful features.

Cables, jacks and sockets

Cables and wires are of concern in an office of this size. If you’ve got cables between computers and printers, two phone cords, plugs from your computer and other devices, you have to make sure they are kept out of the way and secured to prevent a tripping hazard. As you move in your equipment, also be wary of where you electrical sockets, phone and Internet jacks are. You will probably need a power strip or two, which are inexpensive and readily available. And of course, don’t get caught with a plug that doesn’t reach the socket.

Three-Plus Person Office

When your office grows to three people, your needs become complex. You will find it is necessary to set up a network to connect all computers and to efficiently share data and devices. It is also at this point that you must ensure your office will be able to grow effectively, so new members can be brought in with ease later.

Choosing Hardware

In larger offices, either laptop or desktops may work. If your office includes a conference room where employees will be giving presentations, laptops may be preferable, as they can be moved easily, so there will no longer be a concern about how to get a presentation onto another computer, or whether or not it will be compatible with another computer’s format. (Similarly, wireless Internet may make this process more convenient, as it eliminates the need for cables trailing across the conference room if employees bring in laptops.) One important consideration, if you do choose to go with laptops, is security; laptops are a prime target for thieves and 90% are never recovered. This means you’ll want to have a plan to back up important data frequently. You might also consider purchasing laptops with special security features (such as a biometric identification system).

Networking

You will definitely need a network with a dedicated server to connect all the computers in your office. Networking like this works by having all of your computers plugged into the server, which is, in turn, plugged into the Internet. The server provides file and application sharing, as well as allowing a network administrator to manage security and updates for all machines on the network. All the connected computers will access the Internet through the network, so you can enforce security and set appropriate firewall rules. Your network will also connect users to peripheral devices such as printers and faxes, so that hardware resources can be shared.

One industry standard server is Windows Small Business Server 2003 R2, which is designed to handle up to 75 users and has capabilities ranging from e-mail and an Internet firewall to prevent viruses to powerful databases for business applications. Depending on the server model you choose, it may range from $400 up to $2,500.

Software

As more people join your company, you’ll need software to help coordinate them, give employees easy access to your inventory, databases, etc. Internet hosted applications, such as Microsoft Office Live, Salesforce.com, Webex Office, Sharepoint, or Net Suite can allow all employees with an Internet connection (now easy to get on a laptop or smartphone) access to these things anywhere, and at any time. (Editor’s note: for more on hosted applications, see our podcast Hosted Applications: Do They Make Sense for Your Bottom Line?.) You’ll also want to put some software and procedures in place for managing security and upgrades on all your applications. At the very least, be sure that the core applications on every machine are set to automatically check for and install updates when connected to the Web; updating and patching software is essential to avoid zero-day attacks.

Phone Systems

Larger offices also require more complicated phone setups, such as a PBX system. PBX stands for Private Branch Exchange and is a small telephone system that would be installed within your office to provide Internet access, as well as phone services including extensions and voicemail for every user, voicemail to e-mail, call waiting, and conferencing. Companies such as Nortel specialize in PBX setups, or you can go a different route and choose a company like M5. M5 replaces premise-based PBXs with an outsourced Voice over IP phone system solution that cuts down the amount of time spent on managing complicated PBX equipment, among many other benefits. In other words, M5 delivers the phone system remotely, which eliminates a company’s need to purchase and maintain a PBX, a very expensive piece of telecom equipment.

Printers

With a larger office, you will also need a heavy-duty printer, separate from other devices (such as scanner, fax, and copier). Look into a laser printer, or even two, as a printer that is dedicated to black and white printing will be able to print more pages per minute than one that prints both black and white and color. HP offers a laser printer for black and white only that costs $430 and handles up to 27 pages per minute. On the other hand, for $450, a laser printer which does both black and white and low-quality (not photo- or brochure-quality) color may cost only $20 more, but prints only 10 pages per minute of color and 12 of black and white. If your office can expect to print significantly more plain documents than colored ones, it is easily worthwhile to have a dedicated printer for its speed. Additionally, if your office requires higher quality color printing, you will have to take that into account when selecting a printer. Though some are available for the same price or less (one of HP’s high quality color printers is only $360), they are also much slower than the black and white only.

Mistakes to Avoid

Ramon Ray, editor of smallbiztechnology.com, provided Success with the five most common mistakes small business owners make when setting up a new office:

1. Doing for yourself what you should hire a professional for: If you don’t know how to setup a computer network or hook up new phone lines, spend the money to get it done professionally.
2. Using free applications instead of paid ones: Freebies are always nice, but a lot of free software doesn’t come with a guarantee or support. With a paid program, you can get the support you need if something goes wrong.
3. Not thinking in terms of growth: If your company gets bigger, you may need to more space for additional people. It’s not just moving to a larger office, it’s also figuring out systems of filing and information sharing that will be as efficient for 50 people as they are for five.
4. Not thinking about software compatibility with your customers and partners: When you decide what software to put on your computer, keep in mind what your clients and partners are using. No one will want to convert files to be readable by another program just to work with you. Even if you don’t use the standard software within your office, make sure you’ve got a few copies of it on hand for when customers send you information.
5. Not keeping customer needs in mind: This doesn’t just apply to your business’s goals, it should be kept in mind in your office setup. Will your customer need computer access? Do you need a waiting room? What will hang on the walls? Will you have a water cooler and coffee maker? The more people who will be in your office, the more you need to keep outsiders’ opinions in mind.