Help with getting started as a technician/starting up a repair business.

[carrcomp]

I'm reading up on it this very minute, lol.

My remaining confusion revolves around upgrades. What if I want to buy a cheap old computer, upgrade the MOBO, RAM, and CPU and sell it as a custom? This would not fit MS' refurbishment standards, so I can't sell it as such. But do I need to reinstall Windows if it was loaded with a retail version at the time I bought it? I need to understand more about upgrading and selling custom PCs...and the benefits/drawbacks of retail Windows VS OEM Windows.

Retail version of Windows has a very different licence. That one can be transferred between machines so you can do that.

I do want to point out that when you replace the motherboard, that is when you need to purchase a retail. You are not refurbishing if you are replacing the motherboard. It's a new computer.

 

[YeOldeStonecat]

Some feedback from someone who is towards 20 years of quite successfully being in this business.
*Nothing beats "Hands on" learning...especially when done under the guide of experienced techs.
*And that's best when combined with formal training/certification (such as CompTIA A+, Network +, etc).
*Throw in a tremendous amount of "self taught" and learning available from "the 'net" and forums such as this.

The amount of various things you'll run across.....rarely are things ever the same in this field. This is where learning under the watch of someone experience helps you. You may get 10x computers in front of you one day...and "the fix" for all of them will not be the same. You may have 6 or 8 different methods used across those 10 computers to fix them. It's not like you can just learn "how to fix a computer hit with a virus". There are many different approaches, each situation may require a different approach based on what's ideal for that specific situation in front of you.

When it comes to networks..you'll start by learning small, residential networks. As you can imagine, there are tons of different routers out there, wireless peripherals, different wireless clients.....kajillions of different brands, and tons and tons of different ISP and their particular "modems/gateways". It takes time...and time...and working with many of them over and over until you start to get proficient.

Now it's time to kick up a notch to small business networks...similar thing when it comes to just the network...but you'll now bring into play more complicated Windows Network setups....especially when it comes to the servers. This is again where working under someone with experience will benefit you greatly....and this can take a long time. But it will take volumes of different situations and experiencing different setups until you can begin to get familiar with it.

Sign up for Microsoft technet/action packs....and utilize those tools to train yourself..spend lots of time building (and breaking..and rebuilding) servers and networks.

I know it's difficult to "work under experienced techs" when you already have a full time job and you're trying to segway into this...but it may be worth considering seeing what sort of entry level tech job you can get at a larger IT place. To spend a couple of years gathering experience.

 

[altrenda]

While there have been some good responses here, your original questions kind of miss the point of what it takes to fix other peoples computers for money. That's not bad, the business is just more complicated than it looks. Fixing computers is actually the easy part.

From what I know now, I would pay attention to what 2 of the more successful TN members, YeOldeStoneCat and PCX have to say. There is a lot of good info in those posts.

Spend at least 30 minutes a day going back through the forum, reading anything that interests you. I have been doing this for a living for almost 10 years, and reading TN over the last 2 years has changed the way I do business and made me a lot more money.

 

[cbsnyder87]

Retail version of Windows has a very different licence. That one can be transferred between machines so you can do that.

I do want to point out that when you replace the motherboard, that is when you need to purchase a retail. You are not refurbishing if you are replacing the motherboard. It's a new computer.

That's exactly right about the "motherboard being a new computer", especially according to MS standards. Their exact definition of "new computer" is a different, not necessarily new, motherboard.

I just read some good info on Microsoft's OEM Licensing site (oem.microsoft.com) that explicitly states in point #6 the following:

"When the end user starts the PC, they will be prompted to accept the End User License Terms. These License Terms are between you
as the licensor and your end user. The end user must also activate the Windows 8.1 software using the Product Key found on the COA
label. These steps must be completed by the end user and not the System Builder"

This is crucial to understanding the point behind MS' OEM licensing and regular retail licensing. When a "system builder" builds a new computer (defined by MS as one with a MOBO that is not already licensed to a Windows build) they are not the legal "end user" since they are expressly building the computer for resale to someone else, for profit. Therefore, no EULA is binding to them...ever. I never knew this but the EULA is binding between the builder and the user, not Microsoft themselves and the builder or user. So, technically, MS cannot hold a builder accountable to a EULA...ever...by their own words. A person who builds a computer is only bound to the OEM requirements put out by MS as follows:

"A System Builder is an original equipment manufacturer (OEM), assembler, refurbisher, or a software preinstaller who builds
and sells a customer system to an end user or third party. The definition is broad to cover the various types of System Builders who make up this channel. OEM software licensing is available to PC manufacturers and is designed specifically for preinstallation on new hardware. Microsoft licenses OEMs to preinstall the software, and OEMs in turn license the software to end users via the End User Software License Terms. It is the obligation of the OEM to provide support for the software."

According to the terms and licensing which governs Windows, a system builder is required by law to use only an OEM version of the software. A retail version is only binding to an End User and is only installable/usable by the End User. Since a system builder/refurbisher is most definitely, in any situation, never the End User they cannot possibly go by anything the EULA says. Instead, a system builder should only ever consult OEM licensing.

So, if a person is upgrading the MOBOs/CPUs of old computers they are by definition creating a "new computer", which regardless of the OS installed on the HDD/SSD, by law, a brand new OEM installation of Windows must be installed. Otherwise the End User is not bound to YOU for your new build, they are still bound to the original manufacturer (Toshiba, Dell, HP, etc.) for a computer they didn't design. Since you (the system builder) are by no means the "End User" of that upgraded computer you have no right to transfer the license of the retail version to the new motherboard. Only a private "End User" is allowed to do that. By law no system builder can ever sell a retail version of Windows on any computer. Period.

Will Microsoft pursue you and fine/sue you if you use retail versions on new builds? Most likely...no. But if you want to support your customer the best and run an honest business, not a single one of us on this forum are ever, ever allowed to use a retail version of Windows for a rebuild/new build PC.

I also read on their site that the entire reason an OEM version of Windows exists is because MS wants to provide the system builder with a profit margin. In other words, they provide us a cheaper OEM version of Windows so we can make a profit rather than purchasing the more expensive retail version. This is extremely smart on their part because without an OEM version of Windows, no one could ever build a computer with Windows preinstalled (legally) and sell it to another person (End User). This would greatly reduce MS' market and therefore their profits. So, they created an entire market with which to sell Windows to by creating the OEM licensing and allowing other person's to build their own computers with Windows preinstalled and provide them a way to make a profit. Without the discounted OEM Windows there would be little to no profit made. This is what I love about business. You help yourself thrive as a business by providing ways for others to thrive as a business.

Whats most startling about the retail licensing is that you actually violate the OEM licensing by using a retail version on a "new build" for resale. If you try to pull the "well the EULA says this in the retail version" Windows could (not necessarily will) slam you legally because you are not an End User...you are a system builder and are legally bound to use OEM Windows whether you know it or not. Using a retail version of Windows on a new build could actually be considered pirating because you have transferred the license from one MOBO to another in a computer stamped with "Dell" or "HP" and by definition, a retail version of Windows is supported by Microsoft for End User Support. So you just obligated MS to support a product installed on a computer that you designed for resale. This screams illegal by everything I can read on Microsoft's website...

Man, this thread has helped clarify so much. Thanks everybody!!

(All emphasis in quotes are added by myself)

 

[cbsnyder87]

While there have been some good responses here, your original questions kind of miss the point of what it takes to fix other peoples computers for money. That's not bad, the business is just more complicated than it looks. Fixing computers is actually the easy part.

From what I know now, I would pay attention to what 2 of the more successful TN members, YeOldeStoneCat and PCX have to say. There is a lot of good info in those posts.

Spend at least 30 minutes a day going back through the forum, reading anything that interests you. I have been doing this for a living for almost 10 years, and reading TN over the last 2 years has changed the way I do business and made me a lot more money.

I will definitely be taking this advice. Conversing with the very knowledgeable people in this thread alone has helped me find the right sources of information to clarify the legalities of Windows Licensing...that in and of itself is a huge deal since there is so much "gray area" involved with licensing.

Unfortunately, YeOldeStonecat's advice on working with an experienced person is next to impossible for me. Getting a little personal here (with the hopes it will help the advice of other towards my situation) but I pay child support, have a mortgage, and am a single father whose retired mother also lives with me and depends on me for a living. I cannot, in any circumstance, quit my 65K/year job to start at the bottom of an IT corporation for 30-40k/yr (or less, in some cases). My only option to get into the computer world is to do it on my own and through my own hard work, perseverance, and personal business ventures. I know it's possible, I just need the right education and direction. I have the skills, I just need to learn how to apply them correctly in a business setting and in the Windows environment. So any advice relating directly to home business start up and repair skills is what I need the most. Would I work under an experienced professional if I had the chance? Absolutely!! But it's just not possible for me...

My biggest worry is opening my "doors" for business and then realizing I can't fix a single one of these computers, or I have them for weeks in my home shop (pi$$ing off customers), or actually making a computer worse off after I touch it and getting my business a bad reputation from the start. Maybe I'm worrying too much, but I need to know when my skills are "good enough" to officially open doors and start taking in customers without risking a bad reputation...all without working under an experienced tech (which right now...is you guys).

Am I attempting the impossible here?

 

[carrcomp]

That's exactly right about the "motherboard being a new computer", especially according to MS standards. Their exact definition of "new computer" is a different, not necessarily new, motherboard.


Whats most startling about the retail licensing is that you actually violate the OEM licensing by using a retail version on a "new build" for resale.
(All emphasis in quotes are added by myself)

Yes. but then again you can't technically use a purchased OEM licence when repairing a computer by replacing the motherboard with a different model, because you're not building it with the intention of reselling, you can't use a refurbisher licence because you're not reselling and because of the new motherboard, and reading that you can't use a retail copy either?

I think you're much less likely to get nailed for using a retail copy in this case. And if they are worried about you accepting the EULA on the customer's behalf, nothing in the rules say that you can't install the retail copy and set it up for OOBE using your refurbisher's installation kit (just make sure you use the correct licence)

Take that Microsoft

 

[cbsnyder87]

Yes. but then again you can't technically use a purchased OEM licence when repairing a computer by replacing the motherboard with a different model, because you're not building it with the intention of reselling, you can't use a refurbisher licence because you're not reselling and because of the new motherboard, and reading that you can't use a retail copy either?

I think you're much less likely to get nailed for using a retail copy in this case. And if they are worried about you accepting the EULA on the customer's behalf, nothing in the rules say that you can't install the retail copy and set it up for OOBE using your refurbisher's installation kit (just make sure you use the correct licence)

Take that Microsoft

Haha, well the OOBE and installation kit are actually recommended by MS in their OEM instructions I linked in my earlier reply. The point is (for MS) that they are expressly stating they are not in any way responsible for a computer YOU (or I) build. "You built it; you support it. BUT DON'T FORGET TO USE MY $100 SOFTWARE PROGRAM!!" is in effect what they're saying.

As for the scenario you outlined:

but then again you can't technically use a purchased OEM licence when repairing a computer by replacing the motherboard with a different model, because you're not building it with the intention of reselling, you can't use a refurbisher licence because you're not reselling and because of the new motherboard, and reading that you can't use a retail copy either?

If you have no intention of reselling the computer, then yes, you can absolutely use a retail version because you are the End User. But if you ever sell that computer as a business transaction where the data is wiped clean back to factory condition, then you (legally) are not allowed to transfer your retail version to the buyer. This doesn't mean you can't wipe your drive of all personal data...lots of programs out there do this without erasing Windows or doing a factory reset.

But now we're getting into the details that even Windows themselves wouldn't even care about.

Bottom line (that I can understand) is this:

If you build, rebuild, or upgrade a computer with the intention of selling it for profit in a business setting you are required by law, due to Microsoft's EULA and OEM licensing, to sell that PC with a brand new, fresh OEM installation that is set to OOBE so that the customer can "agree" to the EULA they don't even read that binds your services to them instead of to Microsoft. There is not a single condition which allows any business to sell computers in a "new" state with a retail version of Windows because EULA only applies to private End Users, not system builders/refurbishers.

Retail Version: Only for private use in upgrades or private custom builds intended to be used by the private builder only. I.e., Hobbyists/Gamers
OEM Version: Only for system builders who build, upgrade, or refurbish computers for the sole purpose of making a profit.

When viewed in this light alllll of the EULAs make perfect sense. Why? Because they don't even apply to us,

 

[cbsnyder87]

Yes. but then again you can't technically use a purchased OEM licence when repairing a computer by replacing the motherboard with a different model, because you're not building it with the intention of reselling, you can't use a refurbisher licence because you're not reselling and because of the new motherboard, and reading that you can't use a retail copy either?

Just re-read your scenario here after my initial response and I totally misunderstood it at first. Thought you meant replacing a motherboard for your own personal computer, but I see now that you mean a repair for a customer, not yourself.

In that case (based on what I've read from MS' website) it depends solely on what is already installed in the computer. OEM licenses are permanently tied to the BIOS of a MOBO. So, odds are if a customer brings you a computer to be fixed, it has an OEM Windows from the manufacturer (Dell, HP, etc.) unless the customer has done an upgrade or built this computer themselves. Which, if it's the latter they should be competent enough to replace their own motherboard. So, again, odds are it's an OEM version and the OEM license requires that any repairer replace the bad motherboard with an identical model, call up MS and explain the situation, and they will provide you (the repairer) with a brand new license key to enter into Windows for free.

It does clearly state in the OEM license that if you change the MOBO to a different model, MS will refuse to license the new MOBO with the same Windows. The customer would then be required to pay for a brand new installation of Windows.

If the customer brings in a computer with a retail version due to an upgrade of Windows they performed themselves, then the EULA allows a private user to transfer licensing indefinitely to as many computers as they ever own provided it is licensed to only 1 computer at a time. Therefore you simply install the new MOBO, call up MS, explain the situation on the customer's behalf, they give you a new license for free, boom, your done.

So basically if the reinstallation of Windows is due to a bad MOBO:

If current Windows installation is OEM - Identical model MOBO must be used or customer must pay for brand new installation of Windows.
If current Windows installation is retail - Any MOBO can be installed and the license can be transferred by requesting a new license from MS.

So customers who want upgraded MOBOs just for the heck of it, but have OEM Windows, are screwed. Left, right, up, and down in buying a brand new, car smell Windows installation.

This explains why when a person buys a Dell and 3 years later wants the newest CPU, which is a different socket size then their current MOBO supports, and they go buy a new MOBO, suddenly Windows doesn't work. Because Dell used their cheap OEM Windows installation to build the computer with and it is permanently tied to that original MOBO and the person ends up buying a brand new Windows installation with their MOBO. (After much bickering, moaning, and groaning on the forums of the internets...)

 

[16k_zx81]

I'm currently working on getting my A+ Cert on my own. I look to continuing my education with a Bachelors in IT. However, I'm seriously interested in starting my own computer repair/building/networking business. !

My suggestion would be "dont do it".

The reason is that this industry is getting increasingly tougher. Massively dropping hardware prices and the advent of disposable and mobile devices means that the old 'break/fix' model for computers is dying. fast.

The only bastion of work that has any future is business support, as businesses require services to implement, upgrade, and maintain infrastructures. This means there is ongoing demand for people with 'hard skills'.

So if you are serious, and you actually want some kind of future for your business, the best way forward is to get either (a) some experience in a company where you can be mentored in things like networking and server work, or (b) get certified and qualified in these skills.

Just working in your home and trying to get good at servers and networking - to the extent you can go out onsite and charge people for your skills - is something not many people could realistically do. Businesses will not tolerate 'dabblers' - people who get onsite and try to 'figure things out'. You need to know what you are doing and that level of knowledge needs to be formally acquired.

The days of 'fixing' pcs and laptops as a sole source of revenue are numbered.

 

[cbsnyder87]

My suggestion would be "dont do it".

The reason is that this industry is getting increasingly tougher. Massively dropping hardware prices and the advent of disposable and mobile devices means that the old 'break/fix' model for computers is dying. fast.

The only bastion of work that has any future is business support, as businesses require services to implement, upgrade, and maintain infrastructures. This means there is ongoing demand for people with 'hard skills'.

So if you are serious, and you actually want some kind of future for your business, the best way forward is to get either (a) some experience in a company where you can be mentored in things like networking and server work, or (b) get certified and qualified in these skills.

Just working in your home and trying to get good at servers and networking - to the extent you can go out onsite and charge people for your skills - is something not many people could realistically do. Businesses will not tolerate 'dabblers' - people who get onsite and try to 'figure things out'. You need to know what you are doing and that level of knowledge needs to be formally acquired.

The days of 'fixing' pcs and laptops as a sole source of revenue are numbered.

I have heard several people say this and not to discredit you or any of them in any way, but I just don't see it that way. You mentioned "massively dropping hardware prices". But I can look on the list of Intel processors over the past 10 years on both Wiki and Intel's website and see a steady cost rise, not decrease. Processors used to run $80-$150 in the early 2000s. They now average $150-$250 for a decent processor, below $150 will get you by for a year or two before it can barely run the newest Internet Explorer version.

"...disposable and mobile devices means that the old "break/fix" model for computers is dying."

Again, I don't see it that way. I might be wrong, but I've been in the electronics industry for a while and we simply call this "pop and swap". You pop the bad component out, swap it with a good one, and out the door they go. Simply charge flat rates instead of hourly rates since you can now do the job in literally 1/4 the time it took you 10 years ago.

Just because things will become easier to discard doesn't mean folks will know how to do it.

There's also the security industry which grows just as fast or faster than technology itself. Data backup/recovery/protection may be a main sell for small IT businesses in the near future.

You might see the tablet/Apple/mobile industry go in the "use and discard" direction because of the need for miniaturization and soldered, one-piece components, but desktops will never go away. How many people own an iPad, tablet, or Android but still spend most of their time in front of a desktop either at work or home doing the "important" stuff?

And to top it off, you have major companies with their hands in the desktop business. Intel, AMD, Gigabyte, MSI, etc. who all produce the plethora of parts available for building/upgrading/repairing desktop computers. In order for them to survive in a "use and discard" industry they would have to coordinate with major manufacturers like Dell, HP, Sony, and Toshiba to provide them cheap, wholesale parts to be soldered on at their factory and completely loose out on the retail price they charge for their single piece products.

I do agree that supporting businesses is a strong business model. But in order to have that kind of experience that a business can trust you with, how else can you start other than residential?

 

[16k_zx81]

I have heard several people say this and not to discredit you or any of them in any way, but I just don't see it that way. You mentioned "massively dropping hardware prices". But I can look on the list of Intel processors over the past 10 years on both Wiki and Intel's website and see a steady cost rise, not decrease. Processors used to run $80-$150 in the early 2000s. They now average $150-$250 for a decent processor, below $150 will get you by for a year or two before it can barely run the newest Internet Explorer version.

Most of our business is laptop repairs, not desktops.

What you will see happening with laptops this year is this:

1. A sub-$200 entry point for celeron 15.6". When I started in this game they began at $1200. In other words, were worth fixing.

2. The move from 'laptops' to keyboard-and-tablet type devices. These are increasingly difficult to service. The components are harder to get (ie touchscreens), and the internals are, in a lot of cases, simply not designed for servicing.

3. 'integrated' mainboards. What we see now, as opposed to the old cpu/ram/hdd model is boards that have all of these components soldered on. This is in line with the changes I describe above, and the move to 'tablets' with keyboards, instead of traditional 'laptops'. The problem with these devices is that the whole internals needs to be swapped if a single component fails. Again, not designed for servicing. Simply disposable.

Also;

-. HP are releasing fully working windows 8.1 desktops this year at under $200 (not worth repairing)

-. Intel are releasing x86 windows 8.1 pc USBs at $149.

-. Intel are also releasing a 'button' pc. Ie wearable.

-- in other words, pc's are getting smaller and cheaper. There's a new generation about every 6-12 months that are faster and cost less than the previous generation; more and more 'disposable'

Also, having been in this game for a number of years, I have seen the changes in consumers' preparedness to repair change dramatically. Whereas when I started we were working on $3000-$4000+ higher-end laptops, everyone wanted to fix them, because the replacement cost was so high. Now, about every second conversation I have with a customer contemplating a repair, they ask me "is it worth fixing?"... And then - and this is my favourite comment - "I can get a new one for 400 bucks".

Years ago, we could charge what the work was worth. If we did a virus removal and a screen replacement and fixed a hinge all on the same laptop, we could charge for each service, and the work was profitable. Commonly we would charge $800 for a single repair. That paid us for our time and still constituted value for the customer. Now, what we have to do is, look at the value of the machine, and work out how we can get the quote down low enough to make it worthwhile for the customer to fix. Otherwise the response is "I can buy a new PC for that". And they walk away. It never used to be like this, and this 'chilselling' makes our business harder and harder to sustain, as profits from parts and labour get lower and lower.

The reality is that rents, labour costs, and the price of living is increasing, while what we can bill as computer repairers is going down, each year, every year.


We are closing our shop in May this year. I wish you well, but I think you dont realise what is actually happening for established businesses who's main source of revenue is repairs and services on PCs. The whole scene has shifted for the worse. And its continuing to move downhill. Fast.

You may well think you are going to base a business around servicing desktops. If so, good luck. They are increasingly the domain of businesses, and my original point was actually that there's work there - but that type of work requires 'hard skills'. Without 'hard skills' your target service market is home users, and there are increasingly far more laptops in home than desktops. This is the reality of the demographic. IMHO it would be very difficult indeed to run a viable repair business servicing only home-user desktops. They account for about 10-20% of our business.

Maybe have a look over the forum and check the number of people who have 'got out' in recent years. Technicians are dropping like flies. This is the reality of this industry. In my home town here, shops have closed at an alarming rate. There are far fewer of us left than was the case 5 years ago. You might want to think about that before you invest your own valuable time and energy in an enterprise which is too tough for most businesses to stay afloat now, and its not getting any easier.

Just answering your question. Not interested in a debate. Thanks.

 

[cbsnyder87]

You may well think you are going to base a business around servicing desktops. If so, good luck. They are increasingly the domain of businesses, and my original point was actually that there's work there - but that type of work requires 'hard skills'. Without 'hard skills' your target service market is home users, and there are increasingly far more laptops in home than desktops. This is the reality of the demographic. IMHO it would be very difficult indeed to run a viable repair business servicing only home-user desktops. They account for about 10-20% of our business.

Maybe have a look over the forum and check the number of people who have 'got out' in recent years. Technicians are dropping like flies. This is the reality of this industry. In my home town here, shops have closed at an alarming rate. There are far fewer of us left than was the case 5 years ago. You might want to think about that before you invest your own valuable time and energy in an enterprise which is too tough for most businesses to stay afloat now, and its not getting any easier.

Just answering your question. Not interested in a debate. Thanks.

Wasn't trying to start a debate, my apologies. I have had a serious interest in opening my own computer business for several years and so I'm hungry for any and all info I can get. When information I receive seems contradictory to what I've read and experienced then I question it, not to argue or debate. Just trying to find the best solution to entering the market.

That being said, you have made viable points about the new technology coming in USB PC's, button PC's, and all the like. For a few more years this won't affect our markets that much, in my opinion. They are coming out with 1GB of RAM and less than 250GB of storage...that's barely enough to run a web browser and Windows itself. But technology will increase quickly and within 10 years we'll see them have amazing capabilities, so I won't disagree with you there.

That kind of tech presents vast changes in the digital world, not just for small guys like us. The big corps will have to adjust their markets and you will see companies like NewEgg and TigerDirect having to find all new markets. The vast majority of their sales comes from hobbyists and people like you and I. There's too many question marks for how these things will affect the market at this point in time.

I agree with you that the main venture should be towards the business end of services. And even with that, things will miniaturize more and more.

Here's where I see things stopping with miniaturization:

1) Processor dies can only get so small and pack so much power. Today's "good" processors run on 60-100 watts of power. You will never get that to run in a USB PC or mini-PC without proper cooling. USB ports run on 5v. So to get even 60 watts from a USB would require 12 amps at the port and that's just not going to happen without major heat issues. Even 30 watts requires 6 amps and that's pushing the heat limits of a USB device with no cooling in a closed case, or a mini-PC for that matter.
2) We are already approaching the limit of transistor size before quantum physics comes into play. So packing huge power into small boxes will come to a halt until an entirely new form of computing is developed. I'm thinking things like quantum computers and processors. They are currently in their infancy right now, but so were modern computers in the 50's. Give them another 30 years.
3) There's still the security/virus/tuneup/data recovery market that people are willing to pay for even with miniaturized PCs. But this will most likely be towards the business end as well.

So what's the bottom line? Well, I don't know. That's why I'm searching and discussing these things with others. I believe if a business owner could stay on top of the market and find niches as they see them coming there would still be a way to stay afloat. No business survives without changing with the market. Perhaps you're right, personal desktop services will be slim to none in the near future. But a good laptop or desktop with decent computing power still runs $500-$1000. There's still time to find that niche.

 

[16k_zx81]

Here's where I see things stopping with miniaturization:

Thanks for your insights!

But a good laptop or desktop with decent computing power still runs $500-$1000

The first 12 months of that machine, its not going to come into your store. Its still under warranty.

The second 12 months, its 'unlikely' to come in, as its still reliable.

Subsequently, it would eventually make its way to you. But, at that point, what is the dollar value of that machine? - I will answer the question for you: probably 30% or less than what they paid for it.

And those are the figures you have to work with as a business owner to find ways to constitute 'value' for your service. Some element of that you can control - ie labour, the other elements you have no control over - ie parts, and parts can be very expensive to purchase - Im talking about touchscreens (most laptops these days have them) start at $400 and go up from there. Most ultrabooks these days have integrated top lids. They start at about $300-400. Integrated mainboards start at about $300-400. Palmrests, bases, keyboards, rails, hinges, daughterboards, these all cost money to buy, and often you are replacing more than one part at a time. Its not uncommon for a repair bill - parts alone - to go over $500. This is without any mark-up (profit) from the components. Then you have to make money (labour) fitting them, and stay under 50% of purchase price of a new machine.

- think about it.

The thing any business owner in any industry will tell you you must have in order to make a living:

1. a solid customer base - in other words, consistent 'demand' for your services. It has to be steady and ongoing, or your cashflow will dry up and you won't be able to pay your bills. That means enough people asking for your product each week, every week, every month, every year.

2. a solid product - something the customer base will need - ongoingly. In other words, 'supply'. Something your customers will need - ongoingly, every week, every month, every year.

BOTH of these elements are shifting in real terms for "computer repairers", and this is the issue for the "break/fix" model. I dont know if you remember TV repair centres? - years ago there used to be heaps of them. The same thing happened to them, thats happening to us, now. Customers who traditionally repaired, opted for buy new. The bottom dropped out and almost all of them folded. This is the reality of what is happening. Its not a theory. Its whats occurring in the industry you're proposing to make a living from.

So, what does this mean for you?

What I am trying to say in these two posts are two things:

1. "break fix" market is dying fast. It would be a rare and clever entrepreneur who was able to run a sustainable business these days just making core revenue from fixing broken machines. This will get harder over time, and fast. Your revenue needs to come from something else. Something that *is* sustainable. By all means, look at fixing PC's - just dont rely on it, by itself, to make your money. It won't.

2. Business or 'niche' support is a great way to go. However, to do this type of work requires 'hard' skills and experience. This type of ability is not gained from playing with friends and relatives' machines. In order to work in business environments - and build reputation and customers - requires hard-core abilities that need to be taught, either by a mentor in a workplace, or through significant formal training. Preferably both.

So that's your mission as I see it, if you choose to accept it <G>. I respect the impulse to work with computers. Hell I love my job, and consider myself to have been lucky enough to do what I love these last 6-7 years. We have been pondering these issues every day, trying to figure out a way to stay afloat, but we can't figure out a way to stay relevent and cover our overheads with the drops we have seen in profit over time. Right now we are running on empty and just treading water till the lease expires. It sucks, but I can't see a way through.

Most new businesses run at a loss the first 6-12 months. Make sure you have money behind you before you start, and make damn sure you know where the demand will be for your time, over the next few years. I can tell you one thing though, its unlikely to be in just 'fixing computers'. We get a lot of work doing network-y stuff for businesses. I would suggest that would be a good starting point. Then some really good cloud-infrastructure stuff would also be worth knowing. Whatever you do, you need to be able to work fast, and get it right the first time. Thats the best advice I can give you.

Jim

 

[Kitten Kong]

I agree with Jim to a certain extent in this. (Not looking to add to the debate here).. but I am in a way.

My issue is with refurbished machines (laptops in particular).

Client rings and wants a refurbished laptop. Certainly says you. It's going to cost X.

You contact supplier x, who sells you a mid range laptop, say £120.00.
Either the supplier can supply and will install a refurb windows and coa for you, for another £20-30 (w7 pro).
So right away your looking at £150 for a old (ie over 12 months old machine).
Where as my clients, can go to our local tesco (your walmart) etc, and buy a NEW laptop for £200!. Admitedelly said machine may be a el cheapo celeron, but it comes with least 4gb ram, and a 500+ drive.

There is no sense in us, even trying to sell them a refurbished machine.

Or theres the other side of the coin.

Client comes in, doesn't want the repair to be done, as its ber (beyond economical repair) ie over 50% of new price.

So client leaves the machine with you. COA worn, hard drive flakey.
You think ok, I'll throw in a new drive. £30-40 cheap.. done.
Whoops, needs a new COA, and windows install. Hmm ok. £30+ again.
Add on your time, to install said drive, and windows (my fee is £65.00, yours is ?x.
Hmm.. could do with some extra ram, it only has 2gb. Another £30.

So right now, the machine 'owes me' around £155.

All you can really do here, to make your self competitive is to lower your labour rate, to resell this machine.

I think (and time for tin foil hats here), Microsoft, and all the big OEM's, have gotten together here, to ensure that its a throw away society. Ie, its not worth it for the most part for clients to have their machine repaired. For the cost of the above repair, its worth it for the client to go and buy a new machine..

Most (if MS et al) have their way, of the clients data will be in the cloud. So bang goes the data transfer fee, we used to get.

They are forcing us sole traders, and small pc repair shops to stop being authorised refurbishers, as it is just not worth our while to still be doing it.

Now, unless we diversify in the way things have been mentioned in this thread, then there will be no more lil one man bands any longer.

When I first started in business 10 years ago, I was used to dealing with, and working on laptops which cost in excess of £1000. Repairs were worth doing, and we were earning a good living. Now.. 10 yrs on, I still have some of my old clients from when I first started up, who luckily for me, remain committed to me, and refuse to use anyone else. Some have dropped by the wayside, but thats to be expected. Others have said they use x, because they are cheaper. That's fine. I have no issue at all with that.

I've been a member here on TN now, for close to 5 years. And the number of techs who have come and gone, and shut up shop is unreal.

So SERIOUSLY think.. is this the way you want to be? I'm not trying to put you off.. far from it. It's the best thing I have EVER done. But on the flip side.. all the stress, worry, hassle.. at times, you do feel as if you want to pack it all up, and work for a company.

I am not in the position to be able to do that. I'm disabled with severe back issues. My sickness record speaks for itself here. No company will employ me now. Hence why I started being self employed.

So I will just say.. best of luck

 

[altrenda]

I would like to add a few things.
1.Spend a couple hours at Best Buy, Frys', Microcenter, Target, Walmart, wherever, and see what computers people are buying. Check out Amazon's sales rankings for computers. The majority being sold are laptops.

2. look around TN, and at local ads, In my area, Los Angeles, residential repairs are dominated by part timers, people doing work on the side ,people looking for extra money, retirees, etc. Because of so much competition, in order to get any work at all, the prices have tumbled. Go on Reddit and take a look at Tales from Tech Support. The posts mostly start " I am not a real tech support person, but look what my latest customer did. Anyone with a flash drive, MBAM, CCleaner , and Google is a tech now. Shops are closing all the time, no one seems to be able to get enough customers at a reasonable price to make a living.

3. The last few years, the talk has been that business users are the way to go.The competition has increased there as well. I have a friend and client that runs a small business, and he tells me he gets at least 3 calls a week offering MSP plans for his 5 computers, 2 printers and a file server. Even though he isn't interested in changing, it puts pressure on my prices.

There is still a lot of money to be made in the Computer Support business. There are very successful shop owners on TN. There is always room for people who know what they are doing, and do it correctly, but it's hard to get heard above all the noise.

It's getting less and less about hardware repairs, Malware removal is getting cheaper and a lot of my good, high end clients are buying Mac laptops, which puts a dent in the virus removal business. Networking and wireless system upgrades are growing. Data Security, Recovery, and Migration are also getting better. I also am replacing Exchange servers with Google and hosted Exchange.

It's becoming a niche business. Outlook specialists, Medical practice, small business, I have a friend who does nothing but home based businesses like architects, tax preparers, writers and designers.

 

[PCX]

Just throwing this out there. I don't disagree with a lot of the arguments which state the the computer repair business simply is not as profitable as it once was. Shoot, it will probably even become not worth doing in the near future. However, I think it would be fine to ADD it to an existing and similar business, such as the one you have as long as you put your greatest efforts into what really makes you money. We are going to be changing our business model soon. We will eventually startup a B2B side of the business that will primarily be MSP, but our more immediate change will be change our shop from primarily PC repair to primarily mobile device and Mac repairs. We of course do all of these repairs, but our business name and business model suggests that we do Primarily PC Repair and everything else secondary.

These are the facts in the break/fix world.

1. Mobile device repairs (especially iPhone screen replacements) make more per SF than PC and or Mac repair, and with enough volume, it can make more money per hour as well.
2. Because of how easy Mac repairs are, they require less space (due to them taking less time) and thus make more money than PC repairs per hours and per SF
3. PC repair makes the least amount of money, taking the most time and requiring the most space, but they do have the most up-sale opportunities.

So in short, concentrate your efforts on Mobile device repairs and definitely add Mac repairs and if you add PC repairs, make them worth your time and learn how to up-sell.

 

[16k_zx81]

At the risk of flogging a dead horse (not that that ever stopped me before).

Recent computer pricing specials that came across my desk:

1. HP 250 G3, win8.1, 15.6" 500GB 2GB $229au shipped. (Thats $180USD) for a full, working 15'6" laptop with a windows OS installed.

2. Acer Aspire AT1153 XC-603 mini tower desktop, win8.1, 1TB, 4GB, $299au (thats $236USD) after cashback. (it would cost us $450au just to build this box, and thats before putting any markup on it).

So, yeah, anyone else with the glowing future of the break/fix model?

 

[cbsnyder87]

I don't disagree that the break/fix model is going to go away...eventually. But there's some things I feel which influence the business much more than break/fix.

If a business focuses solely on break/fix...sure, I can see that going away fairly soon. But the average shop should be diversified enough to keep up with the change.

Things like:
- Installation (for small/medium sized businesses)
- Consultation of networking (for small/medium sized businesses)
- Malware removal/fix
- Mobile/Tablet repairs and tuneups
And there's always the data backup/recovery side that both residential and businesses look for. Even with the cloud, most people are not comfortable using it. Neither is it feasible for large amounts of data, such as for businesses and the like.

I know a local shop owner (the most successful in my area) who is constantly inundated with break/fixes. Just stopped in and seen him a couple days ago and he said break/fix and malware are his biggest $$ makers. He had 7 laptops sprawled out, all in for malware in the last 24 hours. He does all of his malware removal manually and charges $75 a pop. His ratings are through the roof on Google and various other websites and he owns two shops in the area. He averages anywhere from 8-12 customers per day, 6 days a week. He easily clears 200K (USD) per year with his two shops. In fact, he is so successful he retired at the age of 35 and works just for fun. (He is 40 now)

His exact words a couple days ago were, "Honestly, I could care less if the entire computer industry disappeared tomorrow. I have invested my money right, purchased real estate, and my businesses pay their own bills in the first 3 or 4 days of each month; everything else has been profit for me. Matter of fact, I made profit the very first month I was open."

His advice to me, as a start-up, was this:

"If you do it right, there's no way you can fail. There are constantly new niches opening as old one's close. The main two reasons why shops are failing today are (a) the owners/technicians are lazy or (b) the owner isn't business savvy and doesn't diversify his skills and knowledge enough to maintain a customer base. Get into mobile and malware removal right now, and as break/repair disappears in the next 10 years you will be all set for the future of mobile/miniaturization/networking."

Again, I don't disagree that the break/fix model is going to disappear. But not overnight and you shouldn't go out of business with the right business model going into the future.

 

[16k_zx81]

Again, I don't disagree that the break/fix model is going to disappear. But not overnight and you shouldn't go out of business with the right business model going into the future.

Thanks for the advice. Sounds like you have it all figured out. Best of luck.

 

[tf76]

Wow. I suppose being a part time mobile tech has it's advantages. I hope all goes well for you Jim.