Is it worth it to make this a business?

[Dr.Huxtable]

I've been doing some computer service for friends and coworkers occasionally the past few years, so it seems logical that I could start charging people a fee and make some side money while I'm in school. I don't see myself making more than a couple-hundred a year, maybe 2k max. I would love the benefits of some tax write-offs, but that's not the goal, and all I can think of that would really count for most of the operation is Internet access. What I want to avoid is exposing myself to liability, but I'm sure I can find or create some basic contracts/service agreements to cover myself.

Is this too much of a hobby? I could have very little income from this, it really depends. If I'm only making a couple hundred dollars, or less, is that easy enough to claim on taxes as an individual?

Another piece to this - my friend is looking into doing electrical component repair while he's in school, too. Would life be easier if we did this jointly as a LLC?

Any thoughts or links are greatly appreciated. I did some browsing already, but I think I've run into too much information for me to filter out what is relevant.

[vangogh]

Welcome to the forum Justin. What kind of computer services are you doing for friends? Chances are you can form a business around it, especially if you're not worrying at the moment about how large it is. Really all you'd need to do is start charging your friends and you'd be in business. I'm guessing you want to do a little more than that though.

You're really not going to see a great amount of tax write offs. Since you're in school I'm going to guess this would be your main income, and unless you make more than a couple grand a year you won't have much taxes to pay. Say you buy a new computer. The way it gets written off is basically that the expense is deducted from your income. So if you make $2,000 and spend $1,000 on a new laptop you basically have $1,000 of income to pay taxes on. Even at $2,000 you're not paying taxes though as the standard deduction is much greater. You really don't see the benefits of a write off until you're making more money.

There's no reason why you can't start a business though and you might be surprised that you can make more than $2k a year. Lots of businesses started as side projects by students.

If what you're friend is doing and what you're doing are similar enough you could go into business together. I doubt an LLC would make sense for you. A general partnership will probably be a better fit for now. Do you think the same customer would need both of your services? If you're both looking to attract different types of people as customers it probably makes more sense to be separate businesses.

The easiest way for you to start would be to start charging your friends a little for the work you do. If they're willing to pay for your services then it's likely other people will be too.

[Dr.Huxtable]

First, thanks for the reply :) I work 2 part time jobs, making about 20K a year. I'm doing basic system restores, virus removal etc - although I'm now opening up to doing hardware replacement/troubleshooting, home networking etc. I'm an Information Systems major, so, besides loving working with computers, I'd like more experience.

As for my friend, typically we'd be having different clients. The thought was that the fields are related, and it'd be easy for referrals to say 'my business partner can do that for you...'. But perhaps we'll just go with similar names and call it a 'partnership' for simplicity's sake. but not legally :)

[vangogh]

Well the 2 jobs definitely changes things then. In that case you probably will be able to deduct things and get a tax break. Naturally what you purchase has to be something you can justify as primarily being used for business, but it's still a nice perk.

All the services you mention are certainly ones people have formed businesses around so yes you can definitely set up a business. Are you thinking mainly having fellow students for customers or would you be seeking customers from the town or city you're in too? Either of course works, but you'd likely try different marketing based on who your customers will be.

With your friend if the customers/clients will be different then there probably isn't any real advantage to have a similar name. You could refer people back and forth to each other, but I think you'd be better off as separate businesses. The reason is that having 2 different businesses being one or even with similar names will only end up confusing potential clients for either business. You want people to hear your name and associate the name with you. You also want people thinking of your services and instantly recall your name. If both businesses are intermingled it confuses that.

There are still ways you can work together to help each other while being separate businesses. You can recommend each other. You can share marketing and advertising costs. For example say you decide to mail out a postcard or flyer. You can put one business on one side and the other on the other and split the costs. You can run promotions together, etc.

[huggytree]

to become a LLC costs almost nothing and making your own contract is easy (just find a few from the competition and combine/make your own)

i wouldnt do a partnership with your friend...there's no reason to...you dont need him, so dont get involved

find out what others charge for your service and price yourself in the middle of the market...you may find all the people getting freebees wont be using you when you charge...you may not really have any customer base...think about this before you bother...if you dont want to grow/expand this may not be worth trying

[nealrm]

Don't go into business with your friend, it's a good way of ending a friendship. Instead have him do his business and you do yours. Both of you can then refer job to each other while maintaining your independence.

[Dr.Huxtable]

The partnership doesn't sound like it makes business sense, thanks for the advice guys! huggytree, do you think that LLC is the way to go? or would a proprietorship with contracts be enough to cover me for liability?

vangogh - students and customers I find at my 'real' job would be where I get business - I work at a pet supply store, so it's not a conflict of interest. plus I'm not going to go in with a stack of business cards and solicit, sometimes it comes up in conversation. Probably not students, as the people I take classes with also have a computer related degree, and the university computer department will actually help students fix many computer issues (I find that to be pretty cool).

Is there anything else I should be thinking about? So far I have: register business name, order business cards, and start keeping track of related expenses.

[vangogh]

It sounds like you covered the few basics to get started. Next up is more learning, which will never end.

From a marketing perspective it sounds like you're mainly going to start with word of mouth at work and on campus. If you're not looking to grow the business all that much, the word of mouth could be enough. If you do want to grow the business more you may want to advertise in the student newspaper. I'm not sure how much that would cost, but you're best bet is likely a small ad placed in the same spot consistently and to keep the ad going for several months. A smaller ad run more often should outperform a large ad run once. You can do similar in local papers, though I would guess that will cost more.

You might as well put up flyers, with the tear off phone numbers at the bottom on every bulletin board on campus and in local stores that will allow it. It probably won't result in the greatest return, but it also won't cost much beyond some paper and some time. If you carry some around you can just add them as you come across the bulletin boards.

Another thought is you could offer free scans to people. Maybe only as an occasional special if it'll be too time consuming. You scan a computer and present your findings. If you can have your scan generate an automated report it shouldn't be too much work. People who don't need anything will be happy and probably share your name with friends. People who's scan doesn't come up clean are now motivated to have someone clean their computer. Naturally you'd hand out business cards to everyone and for those who decide not to hire you then and there you can give them a small discounted price on the back of the card with a limited duration. The main downside with this will probably be the time to do all the free scans. If enough people hire you it'll be worthwhile financially, but I also imagine your time is booked up a lot between the other jobs and school.

As far as an LLC I don't think you need one at this point. The main benefits of an LLC are the limited liability protection and the tax benefits. Since you're a student I'm guessing you don't own something like a house. Your assets probably aren't a lot and so there's probably not much that needs protection. Granted that's just a guess on my part. If you do have a lot of assets that need protecting an LLC could help. I'm also guessing you won't be making enough money for the tax benefits to be much of a benefit. Again I could be wrong. Being a sole proprietor is probably enough for your business at this point, especially if your plans are to keep the business small for now.

[Dr.Huxtable]

Thanks for the info! You're right, no house or anything, just a car, computer, tv etc. So sole proprietorship sounds best. Ill just start thinking about design for business cards/flyers and get started.

Thank you to everyone for taking the time to reply and share your thoughts!

[tylerhutchinson]

If you start a business and get a business name it will allow you to market your services and you will be surprised how much more you should be able to make. Most of what you are wanting to do cost little to no money to start. I use to do consulting as side work outside of my corporate business just to help have some extra spending cash for over a year. Just from that side work I was making more than my main job, and that was my "light bulb" to turn it into a business and I have not regretted it yet.

One thought you may want to look into if you do your own business is build a model for virtual computer repair. I know you can't do all repairs virtually, but I think that may be a good market to get into, and then you do not have to keep local. Just a thought.

I agree not to start a partnership with your friend. It will complicate and possibly damage your relationship. If anything let him mirror your business model and let him create his own. You can then refer work to each other if needed and help each other that way.

Good luck on your venture.

[vangogh]

build a model for virtual computer repair.

That's a great idea. Even for local clients it reduces the need for house calls. Not too long ago I had an issue with my laptop and gave Apple's support a call. The technician sent me a link to allow him to remotely operate my machine while we were troubleshooting it and it made the whole call quicker and easier.

[Dr.Huxtable]

I've pondered the Remote Desktop method, and I think it would work for some customers/issues, if they haven't had a bad experience - I was talking to a lady who tried a new guy to help her, and he remoted in. The problem was that he didn't tell her how to disable it and kept logging onto her computer after the problems were fixed. But, that's how I got my first paying client :)

Thanks again for all of the info and advice guys! I like your story tyler, I hope more people can get lucky enough to turn a side business into a real source of income!

[MyITGuy]

Regarding Remote Support, check out LogMeIn Rescue...it doesn't leave a footprint on the client's computer so once you terminate the session its gone.

You can also check out GoToAssist (Less features, but half the cost of LogMeIn Rescue).

Looks like others have provided good advice, so hope all works out well for you. There's definitely some money to be made in this industry, but also allot of competition so be sure to do some research on the companies in your area so you can set yourself/services apart from them.

[MyITGuy]

As for my friend, typically we'd be having different clients. The thought was that the fields are related, and it'd be easy for referrals to say 'my business partner can do that for you...'. But perhaps we'll just go with similar names and call it a 'partnership' for simplicity's sake. but not legally :)

I didn't see this addressed yet, but I would avoid similar names from a branding/trademark perspective. If you make it big, you don't want your potential customers going to your friends business since the names are similar, additionally if your friends business gets a bad reputation, customers may get the perception that your business is bad as well.

[Dr.Huxtable]

Good points made. I didn't want to invest that much money for remote software, so I'll keep looking for free solutions that will take care of it.
And we decided, based on the advice given here, to keep the businesses separate, but close.

Thanks again for the input!

[vangogh]

Do consider remote options. I think it could be something that some of your clients will want and as long as they do it'll save you money in the long run. You might be able to have time for one extra customer for every one or two that takes advantage of the remote support.

It's not something you have to do, but it is worth considering.


I would avoid similar names from a branding/trademark perspective.

That was definitely part of my thinking with keeping the businesses separate, though I don't think I specifically mentioned the branding angle. With different services it makes more sense to create 2 distinct business with 2 different brands. The combined single brand would likely be weaker than either of the 2 separate ones.

[Dr.Huxtable]

Oh I definitely want to do remote support, I just need to look around for a free program. I can't afford to invest a few hundred dollars into a top-notch program.

[vangogh]

Completely understandable. I found this Wikipedia page listing lots of remote software (http://en.wikipedia.org/wiki/Comparison_of_remote_desktop_software). Some of it is free for commercial use, though I didn't look through the page enough to know if any would make a good solution for you. I'm guessing most of your customers will be running some version of Windows and I'm going to guess many of the free options are *nix. You never know though.

[MyITGuy]

Oh I definitely want to do remote support, I just need to look around for a free program. I can't afford to invest a few hundred dollars into a top-notch program.

My Rescue account sets me back just over $100 a month which is easily recouped with just an hours worth of support.

If I recall correctly, GoToAssist runs about $40 per month.

Do some searching on "LogMeIn Rescue Alternatives" and I'm sure you can find something within your budget/feature set.

A few things that I would recommend you keep an eye out for in your search:
1st - Make it as easy as possible for them to connect to you. I.E. Type in a code on a website and click on open when prompted to download the tool, or send them an e-mail that contains a link for them to establish the connection

2nd - Make sure the software does not install itself (I.E. Avoid the issue you mentioned in your first post).

3rd - Look for something that offers a calling card. This is basically a desktop shortcut with your name/logo that allows them to connect to you without a code/e-mail link

4th - Look for something that offers unattended access and prompts the users for credentials (So they don't feel awkward giving you their password verbally). There are many times that the user is in a rush and just doesn't have the time then and there for me to work on their PC...installing the unattended access I can access their computer anytime within the time frame specified (Hours/Days/Unlimited).

Just out of curiosity, what city/state do you operate out of/service?

[Dr.Huxtable]

I was checking some out earlier and Mikogo looked good. It doesn't do unattended though, so I'll keep looking.

There are a handful of computer shops in town (Salem, OR), so it's hard for me to start a monthly service without knowing I'll have the business to support it... maybe once things are established and settled. But My Rescue sounds like a really great program. Do you have any issues with it?

[Spider]

Just a word about partnerships - there has been the usual round of negative comments about partnerships destroying friendship, etc. in this thread that I must reject them. Don't be afraid of partnerships. Partnerships can be set up in many different ways, and most successful companies begin as partnerships - Microsoft, Apple, Google, Abercromby ad Fitch, Sears, etc, etc.

Mind you, a partnership isn't always the best choice and - for a change - I will agree with the other commenters this time - I see no reason to join in partnership with your friend. That doesn't mean a reason doesn't exist or that a partnership won't be successful - any form of business can be successful if you make it so.

[vangogh]

The main reason for not recommending a partnership in this case is because the two businesses being partnered have little in common. The combined company would likely add up to less than 2 separate companies. It's really not a friend thing in this case.

There's nothing wrong with partnerships in general. However when going into business with someone you have a personal relationship with you're adding your personal relationship to the mix. You have to keep the personal out of the business.Some people can do that, but simple observation says most people can't. That doesn't make a partnership bad or even one with friends of family bad. The best partnerships are ones where the skills of the partners complement each other and all parties put the business first.

Again though it's a moot point in this particular case since the reason for not recommending a partnership is because the 2 businesses don't have enough in common to join them into a single business.

[Dr.Huxtable]

I appreciate the further input on this topic. I understand that partnerships aren't bad, and I'm confident that it wouldn't raise issues with my friend and I, but I take yhe recommendations here seriously based on your experience. Its funny in that the reason we thought it would be a good idea (combining pc support/repair with electronic repair as a 'one stop') is the biggest reason not to do it.

[MyITGuy]

But My Rescue sounds like a really great program. Do you have any issues with it?
LogMeIn Rescue? I've only had two issues in the past 2+ years that I've been using it and they were resolved very quickly by their support staff.

I'm now considering a tool being offered by my PSA (I.E. Ticketing/billing system) for integration purposes...but I need to make sure that the features that I've grown accustomed to are in this piece of software.

[DeniseTaylor]

Hi There

At the risk of making you overly successful, why don't you go online? Create an online computer repair business.

This is what I mean:

If you could do it right and get a hold of the right keywords (not overly saturated, competitive), you could create an information based website that helps people with their computer repair issues plus drives business to your local, offline business. I know a couple of guys doing this and they do quite well.

Just because others are doing it, doesn't mean you can't do it too, as long as you do it well. There's always room for high-quality information and solutions to problems on the internet.

You could start out local, but spend a few hours a week developing your site. Over time, you could have a very prosperous business.

I don't see what it is you're going to school for, but if it's computers, you would also be creating a future for yourself. Your friend could do something similar with his electrical knowledge.

Believe me, people look for everything on the Net. That's why Google is so hard at organizing the world's information.

[Dr.Huxtable]

That's funny you posted this, because I was already thinking along those lines - my part time job is a family owned operation. They use Mircosoft's retail management software, have two sites networked etc. And their IT guy costs about $180/hr. He is always available and takes care of their needs, but he only gives them the bare minimum for information, ensuring that they rely on him. I understand the business side of he decisions, and perhaps he had some bad experiences with clients knowing too much (which then means they don't know enough), but now they're thinking about looking for someone else who'll work WITH them, so they can learn some things about their systems (and yes, I'm feeling out that situation, trying to do some basic stuff for them, for free, to start a good word of mouth).
Anyways, that situation, along with much of the advice here, got me thinking about using the site as a good spot for information, both for new visitors and established customers - I don't think it'd be a bad idea to keep my clients up-to-date on some security things. I can see that it is potentially eliminating some business opportunities, but I'm also a strong believer in building trust in relationships. Do you know what kinds of issues your friends ran into for that portion?

I start my senior year of Information Systems this fall, and next year I'm starting my Master's in MIS.

[vangogh]

got me thinking about using the site as a good spot for information, both for new visitors and established customers

You're completely right about the trust thing. You might even be surprised that this won't cost you many opportunities either. While you'll be helping people and teaching them what to do so they don't need to hire you, most of the people who are your potential customers aren't going to be doing this stuff themselves even if you show them how.

The DIY crowd wasn't going to hire you anyway. They prefer to do it themselves. The non-DIY crowd will be able to see you know what you claim to know and have the skills to help them and some of the information you present will only make them realize the work is more than they want to take on.

It'll also open more opportunities for you. Say you start a blog. In time you can repackage blog posts as an ebook for sale to the DIY crowd. You can also develop tools for the DIY crowd. The free information will be better able to attract links which will help site pages rank well in search engines so the non-DIY crowd can find them.

[Dr.Huxtable]

Those are good observations. And I didn't think about search results, but I'll trust a SEO :)

[vangogh]

A blog can definitely help where search engines are concerned. It's not as automatic as write a post and traffic will come, but if you're willing to invest a little time learning how search engines work you can get most posts to rank with a minimum amount of additional effort.

[jeruelsmith16]

First, thanks for the reply :) I work 2 part time jobs, making about 20K a year. I'm doing basic system restores, virus removal etc - although I'm now opening up to doing hardware replacement/troubleshooting, home networking etc. I'm an Information Systems major, so, besides loving working with computers, I'd like more experience.

As for my friend, typically we'd be having different clients. The thought was that the fields are related, and it'd be easy for referrals to say 'my business partner can do that for you...'. But perhaps we'll just go with similar names and call it a 'partnership' for simplicity's sake. but not legally :)

That was really inspiring. I am only working in a small business of my dad, and thanks for this i'm inspired to look another job.

[alphadore]

There's no reason why you can't start a business though and you might be surprised that you can make more than $2k a year. Lots of businesses started as side projects by students.
.

I agree. Many successful companies were started by students and evolved into billion dollar companies like Google, Apple, PayPal, Facebook, amongst many others.

[vangogh]

Yep, good ideas can come from anyone and the sooner you get started on a good idea the more time you have to refine it and make it successful and the sooner if can become profitable.