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Thinking about starting a business any tips

post #1 of 11
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I have built a couple of computers for friends that have money, but never ask for a penny in return. My friends have told me that I should start a small business out of my house to build computers for locals, that way I don't have to worry about the hassles of shipping since I don't really have money to repair a broken computer on my dime if it breaks while being shipped. What are some pricing that yall think I should do? I wasn't really thinking about doing virus removal and stuff, but just building computers by buying parts off of newegg mainly, and possibly setting it up in their house and getting them started.

Any tips would be helpful, I was thinking a flat rate of $100 to build and set up over the price of all of the parts.
    
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post #2 of 11
I used to this some back in high school. My fee was $100 for a system with parts totaling less than $1000, and 10% for everything above that. Most of the builds were basic builds but occasionally you'll get someone who wants more complicated stuff (special wire management, watercooling etc). People also expect some sort of "warranty" service, they will expect you to diagnose hardware issues/perform all repairs.
Edited by yomama9388 - 2/21/12 at 8:37pm
post #3 of 11
Thread Starter 
Quote:
Originally Posted by yomama9388 View Post

I used to this some back in high school. My fee was $100 for a system with parts totaling less than $1000, and 10% for everything above that. Most of the builds were basic builds but occasionally you'll get someone who wants more complicated stuff (special wire management, watercooling etc). People also expect some sort of "warranty" service, they will expect you to diagnose hardware issues/perform all repairs.

I don't mind doing a warranty for hardware issues, but I will probably set it up only as long as the manufacturer still has it under warranty so its no charge or less of a charge to me. Special wire management shouldn't be to bad, key word is shouldn't though. The water cooling might get me, I have never done a water build and even though I would read up on it a lot, there is no replacement for actual experience with them.

How do you suggest I advertise for business, and are there any tax implications I should know? Also should I have them give me all of the money, and I buy the parts, or should I sit down with the person pick all the parts and have them buy it?
    
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post #4 of 11
Quote:
Originally Posted by KingAroan View Post

I don't mind doing a warranty for hardware issues, but I will probably set it up only as long as the manufacturer still has it under warranty so its no charge or less of a charge to me. Special wire management shouldn't be to bad, key word is shouldn't though. The water cooling might get me, I have never done a water build and even though I would read up on it a lot, there is no replacement for actual experience with them.
How do you suggest I advertise for business, and are there any tax implications I should know? Also should I have them give me all of the money, and I buy the parts, or should I sit down with the person pick all the parts and have them buy it?

For warranty issues I did the same thing, I just followed the part warranties. Water cooling isn't actually too difficult to do, but I would definitely build a few loops before offering it to customers.

As for money and parts I did it on a per customer basis, it really all depended on what the customer wanted. I would normally have a discussion with them about what they would be doing with the computer, budget, and any other requests they had. Then I would select parts and run it by them. I normally had the customers order the parts (the ones I would give them) and have them ship the parts to me where I would build it. Again, I left it up to the customer.

I never formally started a business so I can't speak about tax implications, I mainly did it on the side for a little extra cash. If it's just a local thing you can try craigslist, tell friends about it, facebook, whatever. Just get word out. Most of my business came from referrals, people would pass my name on. You'd be surprised by how many people you'll get through referrals. Maybe starting a website would be a good idea as well. Just throwing ideas out there.
post #5 of 11
Thread Starter 
Thanks man

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post #6 of 11
My friend and I thought about this too and many others have too. The biggest problem is what yomama9388 stated "they will expect you to diagnose hardware issues/perform all repairs". I think the hardest part would be software issues. Someone people will get viruses because they are ignorant about computers, they will blame the quality of the computers.

This is taken from an thread from tom's hardware asking the same question. Link

from "1ce"
I looked into this myself a while back. I did alot of research. One thing that kept coming up was that you won't make boatloads of cash on the sale....but you can make money on service calls. As you currently have no brand-power or market visibility, the only thing you can compete on is price. I wouldn't expect to make more than $50 profit for a budget computer, $100 for a higher end build. Considering the time you spend ordering parts, building it, and shipping it, that's not alot, especially if something goes wrong and you get into RMA's.

When somebody buys a computer from you, if they need help/training/upgrades/repairs, you are their point of contact. They will ask you for help, and this is something you can charge for (Don't be a nice guy and do it for free, however tempting it is). You can easily ask for $50 minimum for a visit even if it only takes a couple minutes to fix the problem, more depending on how long the fix takes. If you get the picture....that's as much profit as the actual sale, and takes way less time.

If you just want to do this in your spare time, use word of mouth advertising to start. If you want more business, then don't shy away from paying for advertising. Get creative....advertising in a hard-copy paper newspaper for repair service will give you exposure to people who are less computer savy and need someone else to fix things for them (otherwise they'd be reading the newspaper online right). Facebook advertising gives a huge amount of control on your target audience.
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post #7 of 11
I actually started up my own brick and mortar PC repair shop with only 900 bucks. so doing it out of your home, and only building them should be a breeze with no capital really needed.

Its a good way to get some side cash. hard part is getting your name out there. I recommend going to small mom and pop shops, and thrift stores and asking if you can set up a place for your cards. Be sure to talk with the owners and be sweet as hell. lol. that way when their friends or customers complain about their computer they will jump to recommend you. That's what I did and it works great.

Also, once you get a little cash I would recommend joining your local chamber of commerce its a great way to network with businesses that may be looking to setting up a PC or network.
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post #8 of 11
Make a business plan. Plan out all of your profits and expenses (if any) and just get it all layed out in a few documents so you can see exactly what you're doing, and how you're going to do it.
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post #9 of 11
It's a niche market in the high end realm and will depend heavily on demographics and less so on other things. The best thing to do is branch it out to other devices - Apple i-stuff, tablets, Andriod powered devices, etc. This way you can be a bit more diverse in what kind of services you can offer.
    
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post #10 of 11
Great suggestions so far.

I think your low for your base price. I say this because you can build a pretty decent pc for under a grand. 10% wont kick in untill you exceed one thousand and a really good build will set you back $1500. Thats alot more work for the $1500 build as there is so much more your dealing with component wise. Because of this I would make sure your best money is made before a thousand dollars and start cutting back on your fee after that. If can get all the parts unboxed, and layed out for assembly, then snap it all together, up and running in under 4 hours thats $25/H. Now you have not included the consulting time prior to the build. Setting up the OS/software or the hand off time. You can add another few hours for that. Your $25/h is now down to $17/h. Add in your time for ordering, finding deals AND if anything arrives DOA that is even more time that the customers pc sits on your desk. You also need to take into account the bad customers (you will get them) who will take up a consiterable abount of time as you explain to them why their pc does work as expected. I would say $100 on anything under a $500 build, these builds can be done in under two hours. $250 on anything $500-$1000 and over a grand charge dont charge flat rate but a percentage on the whole bill plus $20/h. Now you may like building computers but as youve said, its a business so make yourself some money. At these rates it will allow you to fiddle abit with the price for customers who may be looking for "a deal" and give them $20 off the price.
If you buy the product always add 10-30% to the cost of the item, youll be the one who has to deal with shipping/returns for DOA, surfing the web for sales. The other option would be to inform them of what parts will meet their needs and show them the sites that sell the products they want. They order all parts, pay for all parts then bring you the parts for assembly. No markup costs for you but if there is a DOA then you also dont deal with returning the parts/shipping or other hassles that come with online purchases. Your cutting down one big headake.

Find a group of parts that work well for you and try to only suggest those parts. A certain case, H80 vs real watercooling, Small form psu. Make sure you only suggest good companys as this will cut down DOA/RMA, youll always be blamed for a pc that fails to start regardless of the fact they insisted on the $10 psu, refuse to use substandard components. You can also charge extras for sleeving, mods, and upgrades.

ALWAYS, ALWAYS SELL TO THEIR NEEDS, dont push stuff on a customer, inform them of the options and allow them to make the choice.

Building a pc is only one part of the sale. You also charge for the software installed. They need a operating system, antivirus, settings for things like sound cards, networking. There is also room to expand into pc set up, more and more computers are used for storing movies to watch on the big screen, your local network will need to be set up to plumb all that to the tv. Upsell that way too.

Make sure you have the good tools, all tools. Sucks to be in need of a certain screwdriver and the one you have does not reach.

Protect yourself/investment firstly, if the customer looks like a complainer than send them off to futureshop and they can buy oem, or the local pc store and when they tell all their friends that the same build you did your their friend was $250 more expensive to have the "real shop" build it, YOU WIN AGAIN.

Over time youll start to stock pile some money then reinvest it, when the ram you always use is on sale for $10, buy ten sticks and resell them for standard price of $30. PC parts drop in price quickly, dont buy anything to sit on unless its a amazing price or your sure to use it right away. Buy the things you NEED.

For advertising use the pics of your builds, classifieds, word of mouth, posters on telephone poles/bus stops, local highschools pin boards. Where ever the customer you want hangs out, advertise there. The person who wants the $2000 build is not hanging out at the local arcade, just as the person looking for a budget upgrade is not going to be having coffie at the most expensive coffieshop in town.

I dont know, i could go on and on but those are some of the basics, most important is sell to needs and know your customer.
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