Moving my business - Good idea?

[SS113]

Hello everybody!

Here's the situation. Me and a buddy run a small computer repair shop. We've been open for about 1 year and 8 months now. The problem is (I believe) our location. It's not in a shopping plaza or anything that has foot traffic. It's on a busy street but nobody really stops unless they have specific purpose (around us there's lawyers, Tax services, and Insurance.

Right now all of our clients pretty much come from Google, Yellow pages, and few other small referrals. We get pretty much 0 clients that just "saw" our location.

At the end of the year our contract is up and we have to decide what to do (re-new for 1 more year, move, or close business) I say close business because we do make money, but all that goes to pay rent, utilities, advertising and that's about it. There's really no room for "profit" that we get to keep for us.

I've had to keep 2 jobs- one main one that pays me, and my business as a secondary that doesn't. My buddy does that same so right now we both work Mon-Fri 9-5 somewhere else and I have my wife stay at the business to answer calls, and check in computers as they come in. After work I go to the biz to repair anything that came in so it can be picked up the next day.

I realize I cannot keep doing this if I want a successful business so I have decided to look for a new, better exposed, place. Well I found one that is perfect! It's about double the size of what we have now (1200sq ft vs us now 600sq ft) but the big thing is the price. Since it's on a very good, prime location they are asking $35.50/sq ft so the monthly payment will be ~$3000 compared to $600 that we pay now! :eek:

So my big question is, is it worth the risk? I mean I'm stuck between a place that doesn't really make me any profits but has cheap overhead OR a new place that has TONS of exposure and foot traffic but it's 5 times more expensive just to rent out AND I have to invest more $$$ to make it presentable - make it into a repair shop/retail store?

ANY suggestions would be great because I don't know what to do! :confused:

Thank you

[vangogh]

Welcome to the forum SS113. First let me say I'm not sure anyone can tell you what to do. There are several things to consider and quite honestly none of us are going to have enough information to say do this or that. Because of that I'm not going to vote in the poll and even suggest you'll probably get a better response by not having a poll at all.

Realistically you yourself won't know the right thing to do even with all the information. This is going to come down to make a choice about what you think best without really being able to know what will work best.

That said here are some thoughts.

You mention there's currently no room for profit. If that's the case how will paying more to be in a different location help? More customers doesn't automatically mean more profit. It just means more customers. If you and your partner are both working 40 hours a week at other things how many customers can you reasonably handle?

Will a new location really lead to more customers? The store front might be more visible, but does that mean more people will bring computers in for repair? People aren't exactly walking around carrying computers to bring in if they happen to be passing your store. I don't see your business as one that grabs foot traffic. A better location can certainly lead to more awareness, but awareness doesn't automatically lead to more customers and there are many ways to gain awareness other than the location of your store.

I would think the more typical way a customer will find you is they first have a problem with their computer and then they seek our where to get it fixed. It's possible that means bringing it to a store that happened to walk by, but I would think it more likely means visiting a search engine or opening a phone book or asking a friend.

How will double the size help your business? Your business doesn't really require a lot of space where customer interaction is concerned. Mainly you need a counter where someone can place their computer and presumably you can plug it in and turn it on so you can both look at it while the customer describes the problem. Do you need more space to do the work or do you have enough where you are now? More space can lead to a more positive perception though so even if you don't need the extra space for yourself or customers it can lead to a more favorable view of your business.

None of the above should be taking as me saying you shouldn't move. I don't know the answers to the questions I'm asking. I'm just trying to raise a few points for your consideration. I hope it helps.

[SS113]

Thank you for the quick reply..Yes you did raise a few point I never thought of before, especially the foot traffic. But what I meant was foot traffic around the location, not just to us. For example, the location is right next to a Denny's, Cash America, a Barber Shop, A Perfume place, and they are building a Panera Bread right now 2 doors down. I figured since Panera is REALLY big on customers bringing in their Laptops to work on while eating there, it'll be a good place to be near.

As far as size, you're right, we are perfectly fine with the 600sq ft we have now so I would only want a bigger place if we introduced a small store front for spare PC parts alongside the repair shop.

You mentioned the 40 hrs that each of us put up at another place. While that's true, We do average about 31 hrs at the biz after hours and on Saturday/Sunday. Since it's 2 of us, we can turn out a lot of repairs. By the way, we were employed before that for a major computer repair chain where we repaired upwards of 50 pcs a week at the same 28-32hrs a week level.

By the way I forgot to add in my original post that the new place required a 5-year contract!!! :eek:

[vangogh]

Just good timing for my quick reply. :)

I see some new information. I'm not sure things like the Denny's and Cash America will make much of a difference other than to help bring more people into the parking lot. It does put your business name in front of them, but so does your business card at the register inside the Denny's. The new location does make your more visible. I just want you to consider if it makes you visible to the right people at the right time.

The Panera Bread nearby is interesting. That is a place where people are likely to have computers with them and those people will be more likely to notice you and remember you. I can see where being close to them could be beneficial.

Sounds like the hours are no problem. I wasn't sure from your first post if it was an issue, but it sounds like you have more time than customers. The question is do you think the new place will bring in 5 times as many customers as you currently get now? (assuming your profit margin remains the same) Could you charge a little more in the new location to offset some of the cost? 5 times more expensive is a lot, especially with a 5 year lease. I was going to say in my post above you should minimize your risk by seeking a short term lease in either location.

How many repairs do you think you'll need to average each week in the new location to offset the costs and make enough money?

[SS113]

Yes, charging more would be the normal thing to do going to a better location. The way I was looking at it is this:

Right now our average repair is between $80 and $150 per machine (profit). Lets keep it average of $115 per PC. If every other day a computer comes in we take in $1725 for the month. Taking out the rent, power, internet, insurance, phone, advertising, water cooler brings us down to about 670 left over. Of course this is is not true since we only make about 200-300 left over for the month, it's obviously less than a PC every 2 days.

Now, if we move to the new place, we would have to get at LEAST 2 PCs every day averaging about $150 to make about $9000 profit. When you take out the rent, power, internet, insurance, phone, advertising, water cooler it brings us down to $5452

That would actually be great because if we have to quit our current jobs, we would have to get paid from the business so $5452/2 is $2726 for each of us.

This would be a good scenario and I'd do it but this is not an ideal world and every repair is NOT going to be $150 and I will not get 2 every day.. :rolleyes: This is where the problem comes in... I know people will come since there are NO computer repair shops in that area but I dont know how I will cope with the expenses up until the moment of those 2-$150/day dreams...

[greenoak]

;i would get a bigger base before signng a 5 yr contract for 3000 a month...thats a pretty huge committment...
.. and keep on working on your google and maybe small local ads and hope the referrals grow..... hopefully some fun AD on your car like geek squad....or super geeks etc etc....
good luck...im sure your town needs you...

[seolman]

Before moving I would do a serious break-even on where you are now and use worst case numbers. Then consider how to increase the traffic where you are vs. the move. Even if you move it will take a while to build up clientele so how much will you have to invest before you get sufficient traffic? Could move money be better spent on a big attention getting banner on the front for your building "Why is your computer running slow? Free Evaluation!" or similar? Maybe an ad in the local Penny Saver? How about "free flash drive with memory upgrade!". If you give people a reason to visit they will come to you. Most small business struggle because their marketing budget is too limited.

[greenoak]

ditto with seolman....
we believed in running the same and over and over and over...... that might work for you in the pennysaver.....then when they need 'later they can find you....we did that for a long time in a local cheap penny saver.....and used more expensive ads once in a while.... for events etc....also we kept a good customer database right from the start.... thats cheap and sooooo worthwhile........................

[Spider]

From all that has been said above, I think the facts lean towards staying where you are and spending more time on marketing, visiting computer and electronic stores (that don't have a service department) and leaving a small brochure, visiting surrounding company offices to try to set up an emergency "You break it - we'll collect it and fix it and bring it back" service.

One of you needs to be doing the repairs while the other is marketing, selling and shmoozing. If that seems unfair, alternate - switch roles weekly. If you are going to grow your business, you have to stop doing the work of the business. Stop working IN the business and start working ON the business.

Once you have built up to a steady flow of being regularly busy, hire someone to do the work and both of you start marketing, selling and shmoozing. Then hire another worker. Then another.

Then you will be ready for larger premises. Even then, I would think your larger premises can be in an industrial area, not a fancy (and expensive) retail area.

Think big, my friends. Think eventually of being a major service station for computer stores, companies, and major organizations. Go where the money is!

Good luck!

[Dan Furman]

I think it depends on your business.

In general, I think computer repair shops are a dying business destined to go the way of video stores and TV repair shops.

However, if you also service corporate clients onsite (besides having a shop), you may have something.

[greenoak]

why dan?..
if my computer would break or crash and i didnt have dh...think your mom, i would need some help ...

[huggytree]

if i wasnt profitable in 2 years id quit

your not making money and you want to pay 5x in rent to hopefully improve your business......there's no way anyone on here can give you the answer to this because we dont know the location....the only way is for you to visit local businesses and ask the owners how much foot traffic comes in from the street

your not a restaurant, your a computer fix-it store ....people arent going to drive by and say 'im in the mood to get my computer fixed'....will your off the street traffic improve if you move? probably....will it be 2 or 3x improved? not a chance....it will probably be something that is measurable, but nothing major in my opinion

why would anyone repair a computer??????????????

if its 3-5 years old and breaks isnt it easier to just go out and spend $400-500 and get a new one....one that is significantly better

unless you can repair them for $50 i dont see why anyone would repair them....they are just too cheap

im not going to be very positive....id give up and move into something else....2 years is enough time and i think there's no need for your business for most people

[vangogh]

@SS113 - I think Dave is right about running the numbers looking at worst case scenarios. My instinct is to say you're better off improving your marketing where you currently are, but you never know. It's worth crunching a few numbers and seeing how plausible the move is. The 5 year lease is a risk so you would want to be sure.

One more question. Do you have email addresses for all your existing customers? Some way to quickly let them know you're moving if you do decide to move. If so how many do you think would follow you to the new location? Are the two locations near each other? If moving won't cost you many existing customers it stands to reason they'll still come in to a new location the same amount they've been coming into the old one.

I'm still on the side of staying where you are and working to market your business better. Unless you think your current location is keeping business away it sounds like it's the better deal. While the other location might sound great I would think a similarly good location will be available in the future should you decide to move.

As far as marketing goes what have you been doing? We have a few people here who do marketing for a living or as part of their business and most everyone here has done some marketing for their own business. We might be able to offer some good ideas to get more people in at the current location.

@Dan - I think in time computer repair probably won't be the business to go into (outside of support for businesses), but I don't think that time is yet. Most people still don't know how to fix computer problems and not everyone knows someone who can offer the support. I agree in general with you, but I think there's more time for this kind of business.

[seolman]

I greatly admire young, dynamic persons starting up new businesses and taking the same chances that many of us took when we were young (say 900 years ago in VG's case). The following may sound simple but it has helped me many times to keep a clear path to success:


Know your costs. Draft up a budget and refine, frefine, refine until it's perfect. Be strict - get rid of any "miscelaneous" expenses. If you can't clearly define any GL entry, leave it off the budget.
Truly differentiate yourself from everyone else. Find any way to build a niche where competition is limited. Example: gamers spend tons on upgrading their PC's so they can play the latest games, faster and better than their rivals. Make your shop the leading place for gamers to get the latest upgrades. There may be an opportunity there.
Be the first to offer any required service to new products such as iPads, smart phones etc (if possible) you would increase market share. Stay ahead of the competition in technology.
Get a great CPA - beg, borrow, steal from grandma to be able to hire someone good. but get someone on the team who understands the numbers. A good accountant always saves you more than they cost.


The main ingredient is dogged determination never to fail.

[vangogh]

say 900 years ago in VG's case

C'mon, I was born in 1853. That's hardly 900 years. :)

[seolman]

Me and Einstein both failed math..the same year.

[vangogh]

gamers spend tons on upgrading their PC's so they can play the latest games, faster and better than their rivals.

I was thinking earlier about gamers too, though not necessarily for upgrades, but for custom built machines. Upgrades work well too. Modding cases is another biggie in the gaming world. This probably doesn't work in the smaller location, but with a bigger location you might be able to sell parts to the DIY crowd. Offer classes to get people in the door and have them buy all their parts from you on the way out.

We haven't even mentioned a website yet and asked if you have one.

[SS113]

hehe wow! Thank you all for all your comments and suggestions! I should have registered here long time ago...:cool:

Anyway, here's a little more about "us" aka PCMedik and our advertising campaigns!

Since we do Web Design at our company, we currently possess around 35 websites ranging from Computer repair, To Data Recovery, To iPad, Tablet, Xoom screen repairs and many more.

Our MAIN website is pcmedikonline.com it is currently #5 on Google's first page in our "search term". We do get a lot of traffic from the Natural Google Searches but it's not enough as our main rival (down the street) is always on number 1 no matter what you search for computer repair and people naturally call the first person they see on Google

Anyway, most of the websites are still not up yet as we are still building them slowly over the weekends. What we really need to do is move up to #1 on Google for our main site so we can actually start seeing results. We DO have Google Places advertising and that's done wonders (especially last month of July) but it's expensive! We spent close to $250 just for that month!

The other advertising we do is in Yellow Book ( PCMedik on Yellow Book (http://www.yellowbook.com/profile/pcmedik-llc_1858018348.html?classid=2355) ) that is costing us around $60 a month because they put a physical ad in their book and we have a custom site that they designed about our "custom computers". Basically to combat people with old, unrepairable computers, we invented "CG computers" or www.mycgcomputer.com (http://www.mycgcomputer.com) where we will have a site to offer people pre-built custom computers ranging from low end to high end gaming computers. Also yellow book has a custom number that people call so we can track how many people came from yellow book.

Last year we got BURNED by using "register tapes" that puts your ad on the back of each receipt of the local grocery store (WinDixie) 2 miles from our location... We were paying $150 a month for a full year ($1800) and we didn't get ONE customer...just a couple of calls.. We even changed the ad's look and content 2 times and still nothing! So I'm not doing that again.. :o

Next is the "Spanish" yellow pages. Since in our area Hispanics mostly live we would want some Spanish attention as well. Well back in May we signed up for these Spanish yellow pages and it was $250 down and $250 over the next year. We received a letter saying that the publication is delayed until December so now we are stuck and cannot back out of the contract and that was another fail....

Next was the all mighty Craigslist ... While it did work wonders when we opened up, for some reason we stopped getting calls from there.. it seems like people kept looking for new places (or cheaper places)

Next was a BIG "Computer Repair" banner we put up at our location. Because we are in the city limits of Kissimmee, FL, the city is VERY strict on placing ANY banners/signs/yard signs of your business. It can't be more than 3 moths a year and there's a fee of $35. Other than that, we can ONLY put 2 signs on the actual building. By the way you can see the Banner here: 157

That last picture also shows the actual location of where we are and HOW BAD you can't see our location. We are in the middle on the first floor but all those shrubs are taking over every summer and the landlord will ONLY cut them once a year in September/October

Anyway, moving on!

For a month we tried out Facebook advertising and that did work to get us noticed by lots of people, but it did not really bring any repairs in! So I canceled it and now am just on Facebook ( PCMedik on Facebook (http://www.facebook.com/PCMedik.Computer.Repair)

At this point THE ONLY real good advertising comes from Google but it's Just tooooo expensive! I'm not talking about AdWords by the way, I'm talking about Boost Ads that cost an arm and a leg! ($3 to $5 a click) so I had to slow down even though they work

We've thought about yard signs to put on intersections but never got around it and I don't know how well it will work.

As you can see we have tried almost every venue of marketing strategies that we can think of that we possibly can do to get attention and yes, it has worked but not to the extend that we would have hoped.

I do have to mention that while in our 1st year, we were still employed by the large company that we were techs for and we could not tell them about PCMedik. Given that we could not do Facebook and all other sorts of ads that we can now so in my eyes, the first year was a flop as far as trying to get attention.

If we are missing something as far as marketing goes, please by all means do tell!

[SS113]

Hmm.. I tried replying this morning but it said a Moderator needs to approve my post.. :confused:

It's been over 12 hours now and still nothing? Am I doing something wrong?

[Dan Furman]

why dan?..
if my computer would break or crash and i didnt have dh...think your mom, i would need some help ...

When you can buy a new desktop / laptop for $500, it's almost not worth it to fix an old one. The days of a computer being a major $1,500 - $2,000 purchase are prettymuch over (for most people).

You have to assume that most "new out of the box" computers are going to last three years pretty easily. So how much would you spend to fix a three to four year old computer? You're going to unplug it, take it to the shop, and wait for days? In home service? That's even more expensive. And gamers? Computer gamers these days have dwindled to the hardcore - generally, they know their stuff. By and large, they don't need help swapping hard drives and video cards.

We had four computer shops in my city seven years ago - we have none now. The closest one in 30 miles is the last man standing, across the river. Come to think of it, we had four video stores, too... I definitely think it's a dying business.

Onsite business service is another story, though.

[SS113]

When you can buy a new desktop / laptop for $500, it's almost not worth it to fix an old one. The days of a computer being a major $1,500 - $2,000 purchase are prettymuch over (for most people).

You have to assume that most "new out of the box" computers are going to last three years pretty easily. So how much would you spend to fix a three to four year old computer? You're going to unplug it, take it to the shop, and wait for days? In home service? That's even more expensive. And gamers? Computer gamers these days have dwindled to the hardcore - generally, they know their stuff. By and large, they don't need help swapping hard drives and video cards.

We had four computer shops in my city seven years ago - we have none now. The closest one in 30 miles is the last man standing, across the river. Come to think of it, we had four video stores, too... I definitely think it's a dying business.

Onsite business service is another story, though.

I would have to disagree with you on a few things. I worked in the repair dept. at a Major retailer for about 3 years and you'd be surprised how little people know about computers (even gamers).

So lets say that you just bought a laptop. You say it'll not break for a good 2 to 3 years. While that's true, what happens to people that spill their coffee on their keyboard and fry the PC? What happens to the people that tripped on the power cord and pulled the PC off the table flying down and cracking the screen, breaking the Power jack, and killing the HDD? Do you know how to take apart a laptop and replace a screen, solder a dc jack back on, or replace HDD and re-install Windows?

Do you know how many gamers come in with their "custom" built rigs that they "thought" they can build, setup, install windows, and have no problems after? They are my favorite because they assume they know it all and yet they plug stuff in the wrong port, they do not install the CPU right so it overheats and craps out... they burn out memory modules by not installing them right, they can't figure out how to install Windows on a RAID0 config, they can't figure out how to connect their front panel plugs, they can't figure out how much thermal paste to put so they over do it and fry the board and the list keeps going..

Lets not even talk about the people who know how to turn it on, and run IE so they can get to their mail. Those people are have NO idea how a computer works and think it lasts forever so they keep a desktop for 10 years and want me to put Windows 7 on it... They do NOT buy a new computer because "if it works, why buy new?"

Lastly there are the people that think like you do. "If it breaks, I buy another one"....While that's fine with me, do you know how to transfer your files, Quick Books, Outlook and all the other settings from your old PC to your new one? 95% of people don't and they are lost, running back to us to do it for them.''

My point is that even if computers are cheap, nobody will buy a new one if they just bought one 3 moths ago and cracked the screen. They rather spend $120 for me to fix it and $130 for the screen itself. To them a $250 > $499 laptop... they are saving 50% and are happy.. I'm happy and it works.

[Spider]

And I imagine there are a few people who DO know all this stuff and have more profitable things to do with time than diddle with it and prefer to pay someone else to do it. Most people know how to mow their own lawns but lawnmowing is a very popular small business.

[vangogh]

Am I doing something wrong?

Nope. You did nothing wrong. The forum is set to automatically send all posts that include links to moderation until you've been here a little while. It's a simple tactic to fight spam, though as you can see it sometimes trips up legit members. The 12 hours was just me not being around last night and not noticing the post till this morning. All approved.

@Dan - I generally think you're right about the direction of the typical computer repair shop as we've known it for years, however I do think the industry with a few tweaks can certainly last. It's true that a new computer often costs the same price as fixing an old one, not to mention that the new one is likely better. That's how I ended up with my last 3 laptops.

There are still plenty of people who don't think that way. Also note that SS113 mentioned the average repair being a little over $100. $100 is a lot less than $500. At that price point repairing is still the better option for most. I get a new laptop every 2-3 years because I need to for my business. My mom still prefers her computer to last 5 or more years.

I'd also suggest the small shops in your area have gone away not because people aren't needing computers fixed, but because they're getting them fixed at places like Best Buy. At the same time I'm also sure people like SS113 can do a better job and probably at a better rate than the big chains.

Long term I agree with you, but short term I still think it's a viable business and there's time enough to tweak it toward the future. Think about the gaming idea I mentioned. My suggestion isn't to fix computers for gamers, but to teach them how to fix their computers and then sell them the parts. Do the work for the few who don't want to do the work.

@SS113 - I'll come back later and respond to your post that I just approved. I have to get a little bit of work done first. :)

[Dan Furman]

I would have to disagree with you on a few things. I worked in the repair dept. at a Major retailer for about 3 years and you'd be surprised how little people know about computers (even gamers).


I worked tech support for two years (1997-1999) Nothing surprises me here :)



So lets say that you just bought a laptop. You say it'll not break for a good 2 to 3 years. While that's true, what happens to people that spill their coffee on their keyboard and fry the PC? What happens to the people that tripped on the power cord and pulled the PC off the table flying down and cracking the screen, breaking the Power jack, and killing the HDD? Do you know how to take apart a laptop and replace a screen, solder a dc jack back on, or replace HDD and re-install Windows?


But are there enough of these instances to support a shop? I simply do not think there are.



Do you know how many gamers come in with their "custom" built rigs that they "thought" they can build, setup, install windows, and have no problems after? They are my favorite because they assume they know it all and yet they plug stuff in the wrong port, they do not install the CPU right so it overheats and craps out... they burn out memory modules by not installing them right, they can't figure out how to install Windows on a RAID0 config, they can't figure out how to connect their front panel plugs, they can't figure out how much thermal paste to put so they over do it and fry the board and the list keeps going..

Lets not even talk about the people who know how to turn it on, and run IE so they can get to their mail. Those people are have NO idea how a computer works and think it lasts forever so they keep a desktop for 10 years and want me to put Windows 7 on it... They do NOT buy a new computer because "if it works, why buy new?"

Lastly there are the people that think like you do. "If it breaks, I buy another one"....While that's fine with me, do you know how to transfer your files, Quick Books, Outlook and all the other settings from your old PC to your new one? 95% of people don't and they are lost, running back to us to do it for them.''

My point is that even if computers are cheap, nobody will buy a new one if they just bought one 3 moths ago and cracked the screen. They rather spend $120 for me to fix it and $130 for the screen itself. To them a $250 > $499 laptop... they are saving 50% and are happy.. I'm happy and it works.

I understand all of your points. Legit points, at that. But it hasn't been working so far, right? I honestly don't think this is a business where foot traffic will matter all that much (it may matter a little in a visibility sense, however). I can just look around me and see the number of computer shops there were, and how many there are now. That should tell you something. It's just not a business with a ton of growth potential. I'm not sure, in many towns, if it's even viable.

I know computers real well, and have worked in the industry. I would rebuild old 386's when they were the top dog, etc. I loved hanging around computer shops, talking to computer people, figuring stuff out, etc. I'm the computer dude for my family (i'm also pretty aware of the fact that "computer fix it" is not a skill people want to pay for.) So I am very comfortable saying that fixing computers for Ma and Pa main street has ceased to be a good business model. Best Buy can do it because they have the support of everything else they do. They also sell a ton of computers, and piggyback their service with it. A huge (almost monumental) advantage. I'm pretty sure Geek Squad could not survive as a stand-alone business.

Like I mentioned before, if you get into businesses / networking / local corporate accounts / onsite service / etc, you might have something then.

I don't mean to be Debbie Downer here. I know exactly what it's like to be excited about a business.

[huggytree]

if your average repair is around $100 i think your charging too little....i would expect the average repair to be $200-300 range

@$100 i know something is wrong....this may be part of the reason you've got no profit in 2 years....maybe you have enough customers, your just not adding up your expenses correctly and charging 1/2 of what you should....you may be working for $5 per hour....i see it to some degree in my field all the time...guys are $20 under cost...they do office work for free and dont know how to add up their expenses

[vangogh]

The problem at that higher price is you get much closer to the price of a new computer. You can't price repair higher than the cost of new or people will opt to buy new.

[seolman]

Nope. You did nothing wrong. The forum is set to automatically send all posts that include links to moderation until you've been here a little while. It's a simple tactic to fight spam, though as you can see it sometimes trips up legit members. The 12 hours was just me not being around last night and not noticing the post till this morning. All approved.

Off painting in the south of France again? Next time remember to put a battery in your hearing aid so when your iphone pings an email notification you can hear it! :D

[vangogh]

What? Sorry I couldn't hear you.

[seolman]

I'm keeping an eye on you...and the other 57% east.

[Dan Furman]

The problem at that higher price is you get much closer to the price of a new computer. You can't price repair higher than the cost of new or people will opt to buy new.

Indeed. You can't even be close, really. $329 to fix the three year old one vs $499 for new. That's not a tough choice.

Hence exactly why I think it's not a good business. You need to be really busy at that lower "ok, it makes sense to fix it" price point. And despite the actual need for a few people (the instances SS113 mentioned), I just don't see that many people getting their computer fixed. I would guess that only a small percentage of even geek squad's work is people actually bringing in towers / laptops to repair.

I think it used to be a good business... back when a new computer was $1500 - $2500, and the best place to buy them was the local computer shop. But today... unless you sell service contracts / do commercial accounts / do a lot of contract warrantee work, I don't see it as a good business.

Just my .02

[seolman]

In line with the many comments about the cost of "buy" vs. "repair" you might consider modifying your business model to include such things as:


Diagnostics - get more speed from your computer
Software upgrades (for the many Grandmas who are afraid to modify their computer)
Sell your used computer on consignment (offer to do a review/cleanup for a small fee before putting it up for sale)
Sync your iPhone/iPad with your computer - let us help


In fact - these types of services may be much more attractive to a "Mall" type environment where people may be carrying their laptops/ipads/smart phones.

Just a thought.

[vangogh]

Sync your iPhone/iPad with your computer

That's going to be a nonissue in a month or so when iCloud debuts, but the other items make sense. There are plenty of computer related services that could be offered in addition to the basic repair.

@Dan - There are still computers that cost in the $1500 range. I bought a laptop around that price a few months ago. I also paid $300 to fix the one before it. The $300 was a lot cheaper than me buying new and the machine I got back after the fix is worth more than than the cost to fix it. Granted I buy high end computers, but those break eventually too and are worth fixing.

At the lower end the repair cost might still be better than buying new. One repair might not bring in much, but it probably doesn't take long either. I wouldn't be surprised if one person could repair several computers in an hour, since much of the time might be waiting on software to install or run in the background.

Another idea is to run classes to teach people how to better use their computer.

[vangogh]

@SS113 - I think we all forgot to respond to your post that was moderated since it didn't appear right away. Sorry about that.

So far it sounds like most of the advertising you've tried hasn't worked as well as you'd hoped. You haven't tried everything though and even what you're doing now can be improved.

$3 - $5 a click is high. There's no reason you have to pay that to get traffic. You mention your ranking for your main keyword, which suggests to me you haven't really done in-depth keyword research. I'm guessing here so let me know I'm wrong if I am, but I'm going to suggest you jotted down a handful of what would seem like the most obvious words and phrases and solely target those "prime" phrases. Your site looks like it basically targets the same single phrase

What you want to do is expand that initial list. Success with search traffic isn't about ranking well for one or two phrases. It's about ranking for a large number of phrases around a handful of different themes. You might only get get 1-2 visitors a month from each, but taken together all the traffic from all the phrases ads up to a lot of traffic and often much more targeted traffic. The way you have things set up now all of your pages are competing against each other for a single phrase while many more phrases that could bring in customers are left off the site.

Is there a Spanish version of the site? If many potential customers in your area speak Spanish it would make sense to offer a Spanish version. It's probably worth hiring someone to translate the site and offering the language option. From what I understand many spanish speaking people spend more time than most on social sites like Facebook and Twitter. I'd keep exploring both. Your Facebook page doesn't look that active. You probably want to spend a few minutes a day updating the page.

I can think of plenty of topics you could blog about. The content you create would help pull search traffic for lots of phrases and assuming the content can attract links it should also help you rank for those few "prime" phrases you covet. Revenue wise the goal of the blog could be to direct people to the store. There are also new services and products you could add to the business that would work well through blogging.

In any event there are definitely things you can do to get more people to the site and to the store.

[Dan Furman]

That's going to be a nonissue in a month or so when iCloud debuts, but the other items make sense. There are plenty of computer related services that could be offered in addition to the basic repair.

@Dan - There are still computers that cost in the $1500 range. I bought a laptop around that price a few months ago. I also paid $300 to fix the one before it. The $300 was a lot cheaper than me buying new and the machine I got back after the fix is worth more than than the cost to fix it. Granted I buy high end computers, but those break eventually too and are worth fixing.

At the lower end the repair cost might still be better than buying new. One repair might not bring in much, but it probably doesn't take long either. I wouldn't be surprised if one person could repair several computers in an hour, since much of the time might be waiting on software to install or run in the background.

Another idea is to run classes to teach people how to better use their computer.

Yea, I hear ya - there is certainly some need out there. I just don't think it's enough. It's like there's a need to fix plasma TV's... some of them are still really expensive, and some break. But there's nobody local who does this. The one company that does covers a several hundred mile area and does warrantee work for all the companies.

I don't even see towers / laptops being relevent much longer. In ten years, is Best Buy or Sam's Club still selling towers? Unknown, but it seems to be going in the direction of "no" (at least for the consumer "surf the web, do e-mail, write a letter, play with pictures" market). And once we get to where we can do work / use business applications on a tablet, that's prettymuch the end of all that.

The whole problem with computers is you really need to do onsite work. Grandma, who's afraid to install Windows... is she really going to unplug / unhook the tower? Doubtful. So you need to go to her... how much can you really charge to reinstall Windows onsite? How much will she pay before "$499 preloaded w/ windows 7" becomes a better option?

All those computer shops that have gone under... I think that's a definite clue. The way he wants to do it (be a local shop that fixes computers / does software stuff for consumers) is a dead business model. I know we're supposed to try and be encouraging, but I can't in this case, as I feel very strongly about this.

If I were SS113, and I wanted to be in the computer biz, I would definitely be looking to the business market / networking / servers / etc. They'll be the last ones to get rid of their desktops / laptops.

[huggytree]

i pay $450-500 for my laptops from Walmart (Acer's)....i couldnt be happier....i wouldnt consider fixing either of them...throw it out and get a new one

the one im using right now is 3 years old w/o a problem ever

[SS113]

@vangogh
Thank you for your reply on advertising. You brought up lots of good points for me to consider. Since the other owner of the place is a Spanish speaker, he can help me re-do the site with Spanish... maybe a better idea is Google's new translation tool that we can implement and it will automatically offer translation to any of 35 languages depending of the user's browser language.

I will also have to work on the keywords and target larger search phrases like you said.

@Dan Furman
Thank you for your comments. We currently do offer (or want to offer more) services like going out to peoples houses or businesses but with our current work schedule that's pretty much impossible or only the weekend type of thing. This week we did get a business network installation in and did it after hours but it was a pain. The good part is that we did end up charging $200 for networking 5pcs and bought a VOIP phone for them .. we made around $250 profit just from that business so I know what you mean that money is in monthly service plans, business to business repairs and so on but I don't see how that will be possible for now

@huggytree
While you my think this way I noticed something that might have an effect in the way your thinking... you and Dan for this matter. Both of your locations is North. Well the standard of living up there is a little higher than where we are (Orlando, FL) so naturally people over there will get paid more / hour for the same job as people here / hour. So do you think that people here will opt out of throwing a 450-500 laptop when they are working for $12/hr vs the same thing up there for $17/$18?

[billbenson]

To me the $500 or less for a new computer isn't completely accurate. Yes, you can go to Walmart or Best Buy and get a new PC, but it can be a pain to move and install all your old stuff on a new computer. If the existing computer is only a year and a half old (just out of warranty) there may be psychological resistance to buy a new one even if it is the best solution.

Grandma next door isn't going to go to walmart and buy a new computer without the advice of a friend or relative IMO. She's upset to have to get the new machine when the one she probably has should still work.

I would think as well that most of the repairs are software not hardware related.

I do agree, however, with the concept that the business is going to have small profit margins. You need to augment the business with other revenue streams or you aren't going to make much money. There are other businesses that just plain will pay more for the same effort.

On the other hand, you know computer repair so that makes it a logical starting point...

Personally, I'd spend your time learning a skill that will pay more or research what other small businesses in the computer repair business are doing to make more money.

[Dan Furman]

@Dan Furman
Thank you for your comments. We currently do offer (or want to offer more) services like going out to peoples houses or businesses but with our current work schedule that's pretty much impossible or only the weekend type of thing. This week we did get a business network installation in and did it after hours but it was a pain. The good part is that we did end up charging $200 for networking 5pcs and bought a VOIP phone for them .. we made around $250 profit just from that business so I know what you mean that money is in monthly service plans, business to business repairs and so on but I don't see how that will be possible for now

Is the $250 profit after paying yourselves for your time, gas, etc? Or is it you simply got $250 total to network 5 computers? Either is fine, but the latter is far from profit.

The weekends thing is going to hurt because I don't see a point where you can make enough to comfortably "take the leap".

I think running this as a side business is fine, mind you - you could do that until you decide to try something else, etc. No harm there, and good experience to be had (the best kind of experience, really!) I just don't think you should be thinking along the lines of turning "desktop/laptop service for consumers" into a full-time business.

[Spider]

... Personally, I'd spend your time learning a skill that will pay more or research what other small businesses in the computer repair business are doing to make more money.I think Bill has a very good point here. Until you decide to go full time and treat this business as your prime source of income, it will be a hobby business at best. However, even if you lose money, it will be great learning for a successful future as business owners. In the meanwhile, save as much money as you can from your fulltime jobs so that you have money to start a business when you are truly ready.