Thread: Custom PC Business....

I am sort of getting in to a little Custom PC Business. I have built many computers in the past, but never done it as a job. I will be in this business alone. Does anyone have any tips for dealing with the customer, so that everything goes smoothly? I am charging 100$ + price of parts, for my service of building it and installing OS etc...

Yeah, I will offer free support, especialy since most of my customers are kind of friends of friends or friends of family members...

I would get myself a website too.. With FAQs and trobleshooting. Plus if you get 'big' you can advertise your website.

good idea

$100 = £60.65385, I think it's a good price but charge more on sertain parts.

£25 = $41.2575, I would use an eaven number - say $50.

thanks for all the great tips guys! I need to think of a name for my little business, then I'm going to make a website, business cards etc. But right now I am just building comps for acquaintences, for practice I guess. I guess I could do some mods for extra cash. (IE put cold cathodes in case, different color LEDS, and of course windows if the case doesnt already have one.). For now I will be giving free tech support since about all my customers are friends. But after I finish a few PC's I will add fees for problems that are the customers fault. so just about anything but a hardware prob.

Originally posted by novacain

PS web site will not help much as you need customers you can travel to.

yeah, and most of my customers probably wont have internet acces before they get their PC lol... Our local library doesnt even have internet acces. Oh the horror of living in a small town....

$75/hr * 10 hrs = $750 base w/o the computer itself

Thats a heckload of a lot of money when they can just go to gateway.com and chat with a person there and use their nice looking site. Or calling Dell for free, etc etc. You have to offer something else for all that extra money?

where do you get your parts novacain? And 750$ per PC, you must be a milljanaire now

I build only high end systems or networks (now). Mainly for small to medium businesses. (I got out of hardware and into software development)

If you want me to come to your home or office and fix your PC then it is $75/hr. I tell my customers this straight away and tell them to shop around. As I said ring a plumber and ask them what their hourly rate is, judge your rate from this.

>>$75/hr * 10 hrs = $750 base w/o the computer itself

Sorry for not being clear enough....

My point being you will not get paid for every hour.

Other expenses will be incurred that you did not budget for (ie a component being dud from the box, the part you ordered and reserved now out of stock or not working as claimed, customer wants more software installed, problems after computer installed, difficult customers, bank charges for bad debits, bouncing cheques not to mention your mistakes).

For example I have a customer who is having phone problems after I installed their new PC. The phone comp tech says it is the modem not hanging up (after he blamed the FAX). Took 4 hours of my time to prove him wrong and that the customer did not need a new modem. Phone is still patchy (as are all in the area apparantly) Can't charge the customer for the phone companies mistake and the phone company wont pay.....

Understand this before setting a low price. I found for compleate NEW systems a charge of around 20% of the price would allow me to make some profit.

>>where do you get your parts novacain?

The most reliable supplier with the best after sales support (not the cheapest). I am in Australia, still want to know?

>>And 750$ per PC, you must be a milljanaire now

Except I spent it on beer, pies, guitars, PC's and women........mmmmmmmmmmm women.

My properties each cost >$25 per day in bank interest, $50 per week in govt. charges (rates, water).

I place a very high value on my spare time. Something you will understand only when you don't have much free time. Still, I get at least a days work a week (on top of my 50 hrs+ programming) as my customers trust me and know I will give them honest and reliable service.

>>I need to think of a name for my little business,
Don't forget to register it.......

Novacain has some very good advice. Let me see if I can add my two cents as well.

I've owned a business before and its not as easy as it sounds. It was not a computer business but a simple (if there is such a thing as a simple business) little print shop. Let me talk about what I think are key issues - there are more but I'm not writing a book.

Pricing structure
I have two theories about pricing structure and have tried both. You can start out as novacain suggests (start high) and then offer discounts later (but you must absolutely mark hardware up by at least 15% or you are cheating yourself), or you can start low - gain a lot of customers and slowly raise the prices as your expenses begin to grow.

The first approach will not give you a flood of customers at the start of your business. Of course, you'd better not expect to make much profit in the first year or so- you are simply getting your name out and letting people know you exist which is hard enough given the cost of advertising. But this approach will allow you to reduce your prices later - thus bringing in customers and satisfying your regular ones who have been paying the higher prices. So you see that you can start high and realize that your controllable profit margin is high enough that you can lower your prices. It's always easier to lower your prices than it is to raise them - with this approach you are allowed to lower them, but also raise them - as long as you don't get too much higher than your original prices. There is more, but I don't have space/time to write about it.

The second approach will certainly give you a flood of customers and you will think you are in boomtown. However, as your company grows, so do your expenses - inevitably. Takes money to make money. As you begin to raise prices to match your expenses, your customers will be very unhappy and it will be hard to attract new ones. But if you gain a sufficient share of the market in the first couple of years - which is very very hard to do - and you have excellent service and a good rep - your customers might stay with you even through price hikes simply because they trust your work and your business.

You also must decide if you are going to go retail or wholesale. Retail is good money if you can sell the product. Wholesale is also good money if you can find people to wholesale to - like other computer shops in your area. It is possible to do both but again it is hard work and at some times very demanding.

Customer service
The biggest thing is to remember that your customers pay your salary and your expenses. W/o them you are dead in the water - bankrupt. So whatever your pricing structure, concentrate on your customer service - you might have to take a few financial 'hits' just to satisfy a customer - but it will be worth it in the long run.

It is said that 1 person will tell at least 20 other people about your business, if not more - so 1 lost customer due to poor service can effectively cause you to lose 20 more customers and vice versa. There are times when it does not seem 'fair' that the customer wants you to replace ther CPU, even when you are positive there isn't anything wrong with the thing. You are not there to prove to them they are wrong and you are right, you are there to provide them with a service. Most of the time there is an easy peaceful solution to customer problems - granted some customers are just impossible, but most are not.

Credibility
I would also recommend obtaining your A+ certification simply because it gives you credibility. Plus you can use their logo in your ads for phone books and newspapers which tends to carry a lot of weight.

It might cost you some money initially but please, please get a storefront. There's just something to a business having it's own store. If you can only afford to run this out of your house it does not mean you should not try, but one of your long term, if not short term, goals should be to get into a storefront with some POP displays and floor models of various complete systems you can build. You should probably have about 3 main systems - one to represent each income level - like an entry level system, mid level system, and high end system. Don't call them that, but essentially thats what they would be.

I know of several start-up computer shops that have failed because they did not offer complete systems. We techies know about computer components and all of that, but your customers probably do not. Only the select few will come in and know what parts they want - most want to come in, select a system that best suits their needs, and be done with it.

Also, if you get a storefront - keep it neat. I've walked into so many mom and pop computer shops that are just a huge mess of components lying all over the floor. Does not look good for your business. Keep the service area and the customer area as far away from each other as possible - maybe even put a door between the service dept and the sales floor. It would be like you and I walking into a hospital emergency room and seeing guts lying all over the place. Not pretty and you sure wouldn't want to get operated on in that hospital. Noone wants their computer components lying all over the place - they don't see just random computer parts, they see their computer parts lying around. Not good.




You are not going to beat places like Dell and Gateway in the near future, but you don't have to. Concentrate on gaining credibility and trust in your local market and you will reap the financial rewards - eventually. With small businesses it's either feast or famine. Some weeks you bring it in, and some weeks you wonder what the heck you got yourself into. Wish you the best.

Very long, but I learned a lot (and more) by owning a business. Hard work but very satisfying. Hope to own another one very soon.