The future is here for small businesses. No longer do they need to buy and maintain costly computer equipment. Business applications ranging from customer management to ecommerce can be run in "the cloud" using no more than a smart phone.
Cloud computing is a down to earth idea. Your software applications are based in cyberspace instead of on a local server and you pay as you go to use them.
These applications can be operated from au Internet-connected computer or smart phone. Log in from wherever you happen to be and manage your operation, employees and customers.
It releases owners and employees from the bondage of the office and makes business owners "wickedly mobile," says Hamish Edwards, a co-founder of Xero.
The key advantages of cloud computing for small businesses include:
• Cost savings - because you don't have to pay thousands of dollars up front for software
• Business data is accessible from anywhere
• The software updates automatically
• It eliminates the spectre of hardware failure or theft.
A growing number of Kiwi businesses use Google Aps for Business or Microsoft 365 for their email, calendar and documents.
The cloud offers a whole lot more than that. Almost every genre of software used by businesses is available online. Cloud-based applications used by Kiwi small businesses include: backup, inventory management, customer relationship management, shopping carts, and accounting. Even farmers have applications such as iFarmer, a mobile inventory management solution.
Another distinct advantage of cloud computing for small business says is it moves what would have been capital costs to tax deductible operating costs.
In the past all of these applications would have required small business owners to buy expensive and heavy computer hardware, and either employ systems staff or pay local third party providers for costly installs and integration.
Edwards' other business, chartered accountancy firm RightWay, started life from day one with every application on the cloud. The virtual company, which has 12 staff scattered around the country uses Xero, Workflow Max, Google Aps and Capsule CRM cloud-based applications.
Many cloud computing applications dovetail together, says Gareth Berry, whose Unleashed Online Inventory Software product is designed to work with accounting service Xero.
Edwards adds that his product integrates with other cloud software that does: job tracking, time tracking, point of sale, payment, and payroll.
Some businesses will continue to host their applications on local computers, but should consider using online backup says Dan Wong, Telecom's senior product manager - Mass IT.
Too many back up their data on an ad-hoc basis, sometimes to easy-to-lose memory sticks or other hardware that can fail. If the backup is kept at the business premises there is an ever-present risk of fire, earthquake or other catastrophe, says Wong.
The cost savings of cloud computing can be immense. In the case of Unleashed, says Berry, customers who were paying as much as $12,000 a month for their old Enterprise resource planning systems now spend just a few hundred dollars a month for a cloud-based service.
Many cloud-based applications are designed to scale up with the business, says Edwards. A fledgling business, could, for example pay AUD$21 a month for a basic version of Salesforce.com and scale up to complete customer relationship management solution when it is needed.