Build rising technology costs into your budget and grant applications now, before your board or a funder is surprised by the number.
If you’ve looked at buying laptops lately, you may have noticed the number is bigger than you remember. Memory chips and storage, the components inside every laptop, desktop, and server, are in short supply because AI data centers are buying them up at a scale the industry has never seen before. On top of that, tariffs on electronics and components from overseas have added a second layer of uncertainty to pricing in the United States. What matters for your organization is what it means for your budget, your grant applications, and your replacement planning.
Why would AI drive up your costs? It’s less about how much AI anyone is using and more about the global supply chain. Manufacturers are shifting production of the memory and storage chips that go into your laptops toward ones used by AI servers, because that’s where demand is strongest. At the same time, chip manufacturing is already running at full capacity. Bringing a new fabrication plant online takes years and billions of dollars, so supply will likely stay tight for the next few years. Unless the AI chip demand cools significantly and frees up that capacity, these price increases are probably here to stay.
This squeeze is showing up in a few places you might not expect:
This is a sector-wide shift, and that’s also useful context to have when you talk to your board or funders about your IT budget for the next few years.
Rising prices make it tempting to hold on to laptops longer. Before you do, it helps to know what an aging laptop is already costing you in staff time.
As laptops get older, they get slower, need more maintenance, and spend more time out of commission for that maintenance. In our experience supporting nonprofit staff, PC laptops tend to lose speed once they pass three years old. That’s when Community IT generally sees a spike in slowdowns, maintenance requests, and machines that just won’t cooperate when someone needs them.
Here’s a rough way to put a number on it. A staff person working on a laptop that’s more than three years old is probably losing about 30 minutes per week to slow performance, plus about a week a year to maintenance, repairs, or lost work when something breaks. Over a 50-week work year, that adds up to about 65 hours of lost work time, not counting the frustration.
If that staff person earns $60,000 a year, or roughly $30 an hour, that’s about $1,950 a year in lost productivity, for one person on one laptop. And the decline speeds up. Once a laptop passes four years, the slowdown can grow to 20 to 30 minutes a day, which puts the cost closer to $3,700 to $5,000 a year per person. Try it with your own salaries and your own experience.
For many organizations, the math makes a good case for replacing PC laptops around the three-year mark, even at today’s higher prices.
Most nonprofits have moved to laptops for good reasons. Staff can work from anywhere, and everything is built in: the screen, keyboard, mouse, webcam, speakers, and microphone. That convenience comes with a shorter useful life.
There’s no single right answer. It depends on your organization’s cash position, your grant cycle timing, and how much risk you’re comfortable carrying on aging hardware. A few factors worth weighing:
Look at your own equipment inventory and your own budget calendar, not a rule of thumb. If you don’t already have a rolling replacement schedule that flags which machines are coming due, that’s a good exercise to do alongside this conversation, and it’s one your IT provider should be able to help you with, and a prudent move your funders should support.
Whatever you decide about timing, the most useful thing you can do this budget cycle is make the cost increase visible and explained, rather than something that surprises anyone later.
A few practical steps:
Your funders are almost certainly seeing the same cost increases in their own operations, and many are already hearing about this from other grantees. Explain your changing technology costs plainly, reflecting real-world technology cost increases, and show your research where appropriate.
This isn’t the first IT disruption nonprofits have had to plan around. During the pandemic, we wrote about IT supply chain delays and how ordering ahead and staying flexible on equipment specifics helped our clients get through it.
Although the causes of the current price increases are more about supply and demand pressures than supply chain disruption, the advice holds up well: plan a little further ahead than feels natural, keep your options open on exact models and brands, and lean on your IT provider to track pricing and availability so you can update your funders before your IT is in a crisis.
If you want help thinking through your own replacement schedule and budget, or need a tech assessment to set a baseline for your budget and strategic planning, let’s talk.
As advocates for using technology to work smarter, we’re practicing what we recommend. This article was drafted with the assistance of AI, but the content was reviewed, edited, and finalized by a human editor to ensure accuracy and relevance.
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