Hardware requirements for software development company

I'm having a group project in university on developing information systems for software development company. I'm assigned for setting up the hardware for the company. What are some of the essential requirements? I have to put price into consideration. I was thinking about IBM's Intellistation Power 185 Express workstation instead of a server, to cut the costs. What are your opinions on this, are there are any better solutions? I'd really appreciate if those clued in overall hardware structure of software development could give me a little insight in how it's organised and what the essentials are. This is the first semester of my first year in university so I'm pretty new to all this stuff, hence the questions that probably seem silly to you guys. Any help would be truly appreciated. Thanks in advance.

P.S. I'll post more details on fictional company that hired us and their exact requirements when I get home.

re: Hardware requirements for software development company

What are you trying to do?
Do you need build servers, mail servers, file servers, ftp servers, repository servers, and other servers?
What services are you going to provide to your employees?
What services are you going to provide to your customers (if any)?
What kind of development will you be doing?
Do your workers need production machines to deploy applications to?
Do they need more than one machine to do their development on?
Will you be using a Windows or non-Windows environment?
Will it be a mixed environment?
Will you have people working remotely, off-site, at the customer's site, or while on the road?
Will you have rack space?
Will you have to buy your own rack?
Will you be using commodity products?
Will you be purchasing managed products (managed by a 3rd party and you just "rent" them)?

Once you start answering these types of questions only then will we have a better idea of how to advise you.