Is Break/Fix dead?

[britechguy]

Break fix isn't dead, but it's not what it was 15 or 20 years ago.

And I'd say that's largely secondary to the very successful marketing of maintenance service contracts, most of which are cash cows for the individuals or entities issuing them. Much like extended warranties are.

Yes, it's definitely convenient to have someone "on call," but it costs. For myself, I'd far rather be a "break fix" customer as when it comes to computers things break relatively seldom (or else there'd still be a very substantial break-fix business flow from all other sources).

I don't begrudge anyone their success in selling these contracts, but it is that change in the business model from "our side" that was a tectonic shift and because it became "the thing go do," well . . .

 

[Porthos]

Break fix isn't dead, but it's not what it was 15 or 20 years ago.

Also, Computers do not at least to the users, cost what they used to when replacing (at least the cheaper ones) since a good majority of potential clients are really only looking at cost. So in many markets, we can not charge what we really need to actually make a real living.

 

[pcpete]

We do 100k a month in break fix. Ok 10k of that is msp but yes there is a lot of break fix out there.

we are about just about $40,000/month doing break-fix. I disagree with all of the people that say people won't pay. That is not true. You only have to beat the price of new when fixing hardware. In fact we do lots of computers for $259 to $379 for 240 to 1tb SSD upgrades. This price is much more than a new cheap piece of crap. Then most often we will add on $99 plus to preserve their data and programs. We cater to lots of poor people and working class who do not have lots of money, but are still prefer to keep their old system with their whole life attached to it working longer. I have a competitor on this board who always makes the comment the people won't pay to fix anything around our town, yet we see the complete opposite. I think that is proof it is all mindset and a self limiting belief that they think people will not pay.

We never on the phone tell people you may pay 350 to 450 out the door, that would be dumb. We say let us do a free evaluation to see how we can help you best. Then later we present them with the best options available for them.

I do think starting a breakfix model now may not be a good idea. If I was to start from scratch, I may consider MSP business support from the beginning.

 

[Porthos]

You only have to beat the price of new

Unless it is a Walmart/best buy sub $500 computer. Then it is hard to get the value/money for your service.
Again, the Market and wealthiness of the clients are important.
I also do not have a lot of people who actually have their life on the computer. Only turn them on a couple times a week to check email (that many use the phone for) and pay bills.

 

[Porthos]

we are about just about $40,000/month doing break-fix. I disagree with all of the people that say people won't pay.

Those of you who have those numbers, One man or shop and most of all how long have you been open for business and how long did it take you to get there.
All of you have been doing it longer than 5 years and did not make that in the first year. And also back then we did not have as many phones and tablets out there. RESIDENTAL has changed.

 

[Porthos]

I had a call about a laptop screen replacment and told them $120 and they asked if someone else would be cheaper.

 

[lan101]

I had a call about a laptop screen replacment and told them $120 and they asked if someone else would be cheaper.

I only do about 4 or 5 screens a year it seems like anymore. Most of the people that call about them it's the $300 crappy POS laptops. In my area people with expensive ones must not break the screens lol.

 

[phaZed]

I think there is money to be made on both sides of the coin. On one hand, break-fix.. on the other hand you have managed services and continuing services.

I believe a lot of folks here have a specialty in one, and prefer that, and advertise for that and it's skewing everyone's perspective. If one goes on Google looking for screen repairs.. it doesn't give priority or even first page to a managed shop.. a perspective filter.

So for a continuing services provider, break-fix looks like a dead industry, they don't really know about hardware or electronics at it's basic level, it isn't their game, etc.
For break-fix folks, continuing services and management isn't their game, don't see the value as a small shop, etc. insert reason here.

There is money to be made in both sides. I do (until corona) a ton of break-fix work and make a good living at it. I also do managed services and make a good living at that. Both combine to make a 'sustainable' business.

I think the biggest thing is, don't focus on being a "Break-fix shop" or a "Managed services shop". Pending your abilities, time, efficiency and spending cash/frugality?... some of the decisions will be made for you, regardless of your plans. Be a full-circle shop and simply offer what clients in your area are asking for. Yes, technology is changing. Yes, we will have to move forward with it, not against.

All that being said.. I charge $150-$600 for laptop screens depending on model... my average take is 60-80% when counting parts cost.. that's not bad for 10-30 minutes of my time. I do hundreds of screen repairs per year. I do hundreds of motherboards, hundreds of hard drives, etc.

I have been doing business managed services for the last 5-6 years and it also provided great benefits as far as income, but also for getting my name out there. Manage a Church... do a good job and the whole congregation wants their personal computers fixed, antivirus, etc...

So a "Managed job" and a "Break-fix job" really do work hand-in-hand at some level.

Your first 3-5 years will be the worst, toughest years. I literally dumped money into advertising on Google for the first year or so, at least it felt like it.. But, that got my page listed at a primo spot, the good reviews rolled in and now my listing is natural... I don't pay Google anymore.

I say go for it, just don't limit yourself to thinking you can only do one kind of task. Stay vigilant and if your area/customer base/other local problem doesn't support you.. change or quit.. don't keep going on a failing path. When you know to look, it's easier to see.

 

[Diggs]

I charged $450 and the price of the screen was $75. That means 83% of it was profit.

...or 500% profit on the sale. I just can't seem to get my margins up there.

 

[pcpete]

It's definitely your area. San Antonio has a median income of around $50k/year. Mine is close to $100k/year. It's all relative of course, so I should mention that you can buy a good townhome in the next city over (5-10 miles away) for $150k (the same median house price in San Antonio). Places like LA where people make 5x more but their expenses are 5-7x more are a wash, so it's not just about how much people make, but the cost of living relative to their income. People in my area have a LOT of disposable income, whereas a lot of people in your area are barely scraping by. That's why you have clients like this.

Sure better incomes can help, but to imply someone they can't make decent money based on the median income is setting a limiting belief. Our median income is about $10,000 higher than San Antonio and we still do well. It is still a better value to repair and keep someones data than to buy new, ANYWHERE. San Antonio has a 15% lower than average cost of living than the US average. @Porthos I know you have mentioned attracting cheaper people because you work out of your home, that may be true, but I still think if you offer a lower and a better price option, if you structure it right, people would take the premium option more often.

 

[pcpete]

Those of you who have those numbers, One man or shop and most of all how long have you been open for business and how long did it take you to get there.
All of you have been doing it longer than 5 years and did not make that in the first year. And also back then we did not have as many phones and tablets out there. RESIDENTAL has changed.

You are right, we have been doing it for a long time, more than 10 years. I did say it would be tough to start in this business as a newbie. Over the last three years our numbers are up about 80 or 90 percent. This is mainly do to raising prices on ssd upgrades and other jobs, with the idea we want to shoot to make $300 per job. We used to try and make $200 per job average. It took time to feel confident about offering the higher prices, but now it just feels normal.

 

[Porthos]

If you are starting today as a one-man break-fix tech it can be difficult. If you think you can survive with a few hand tools and a workbench and only do Windows repairs and you end up seeing one computer every 3-4 months that cost the client more than $5-600 when new it is not as easy to clear $300 per job.
Those clients when you quote a job to make 2-300 profit they will at least around here never call back.

It was easier when I had a retail shop to get that when the computer is in the shop and you have a captive audience.

I do not usually have to "diagnose" an issue because of experience. I do not have someone come to me in person until I have either remoted for a few minutes or agree to pay a diagnostic if they are not willing to fix the computer if a diagnosis is needed.

For the last 2 weeks, I have lost some sales (about $1000) because I do not keep laptops in stock ready to sell.
Lost a few sales because I do not have webcams in stock.

Not doing onsite work at all even before the pandemic hurts me as well.

I do not do Macs, tablets or phones.

If your clients have better higher-priced computers to begin with, they are willing to pay more to fix them.

 

[sapphirescales]

...or 500% profit on the sale. I just can't seem to get my margins up there.

But it's not a sale. It's a service. The client has no idea how much the screen costs by itself because I'm not selling the screen by itself. I don't make a 500% markup on products that I sell (even refurbished computers). That's just not possible. But services? Yeah, I can do that. You should have much better margins on service than sales. That's just how it works.

Our median income is about $10,000 higher than San Antonio and we still do well.

An extra $10,000/year in disposable income is HUGE. That's almost $1,000/month. It costs a crapload of money just to scrape by nowadays. $50,000/year buys you a pretty bare-bones lifestyle. No vacations, no eating out, etc. In other words, nothing but the essentials. If you can get by with a $300 laptop, then you buy a $300 laptop and live with the slowness. If you can get by with just using your phone, then you save the $300 and just use your phone.

I used to be poor and I know what it's like. That's how I learned how to fix computers in the first place. My family could never afford to buy anything decent when I was a kid so I had to take computers that other people threw away because they didn't work anymore and do what I could to fix/upgrade them so I could actually have a computer. We couldn't even afford to buy a used/refurbished computer. I became obsessed with collecting computers and getting the best computer I could by combining/upgrading them. Before I knew it I had over 100 of them.

 

[pcpete]

It was easier when I had a retail shop to get that when the computer is in the shop and you have a captive audience.

I do not usually have to "diagnose" an issue because of experience. I do not have someone come to me in person until I have either remoted for a few minutes or agree to pay a diagnostic if they are not willing to fix the computer if a diagnosis is needed.

I agree we would lose lots of jobs if we had to give them a price over the phone. That is why we say to everyone, "let us test everything for free and then we can let you know what options are available then you can decide what you want to do". Then you can offer them a $159 repair along side with a $359 repair and let them choose. They can't afford a new system, new programs, and data transfer, but often they can come up with $359 total, especially when you stress to them with the SSD upgrade the computer will run better than new and comes with a two year warranty and they will keep all of there programs intact.

 

[pcpete]

But it's not a sale. It's a service. The client has no idea how much the screen costs by itself because I'm not selling the screen by itself. I don't make a 500% markup on products that I sell (even refurbished computers). That's just not possible. But services? Yeah, I can do that. You should have much better margins on service than sales. That's just how it works.



An extra $10,000/year in disposable income is HUGE. That's almost $1,000/month. It costs a crapload of money just to scrape by nowadays. $50,000/year buys you a pretty bare-bones lifestyle. No vacations, no eating out, etc. In other words, nothing but the essentials. If you can get by with a $300 laptop, then you buy a $300 laptop and live with the slowness. If you can get by with just using your phone, then you save the $300 and just use your phone.

I used to be poor and I know what it's like. That's how I learned how to fix computers in the first place. My family could never afford to buy anything decent when I was a kid so I had to take computers that other people threw away because they didn't work anymore and do what I could to fix/upgrade them so I could actually have a computer. We couldn't even afford to buy a used/refurbished computer. I became obsessed with collecting computers and getting the best computer I could by combining/upgrading them. Before I knew it I had over 100 of them.

those points may be true, but mindset and belief you can get higher prices still is a huge influence on the price people will pay you

 

[Porthos]

I agree we would lose lots of jobs if we had to give them a price over the phone.

I will not have random "new clients" come to my HOME unless they are willing to pay at least my quoted price. Existing clients sure.
85% of the clients that I see do not have any real programs and most will skip data transfer if it costs more. The excuse is that the pictures are still on their phone.

I have been on these forums long enough to see that higher prices can work in some markets but I have actually really made the effort and ran off more possible work than I had repairs in one month. You know, The ole I will call you back and never do.

 

[sapphirescales]

most will skip data transfer if it costs more.

Jeeze, that's rough, man. Over 99% of my clients agree to data backup (a $99 extra charge). I don't have an exact percentage of those that skipped it, but I know it was less than 1%.

those points may be true, but mindset and belief you can get higher prices still is a huge influence on the price people will pay you

I agree that having that mindset allows you to attract better clients, and that being confident in your quotes and diagnoses will make more people agree to move forward with the repair. But some areas just have too many poor people and people that don't really do much with their computers. There's not much you can do with that. I really feel for @Porthos. They'll likely either need to close up shop or move in the future. Hopefully they have enough past clients to be able to make it, but eventually they'll probably dry up too. If I wasn't targeting professional people and home based businesses, I know I'd be in a world of hurt right now. I fear for what will happen to my clients with this Coronavirus thing. Many will likely lose their jobs or go out of business, and that will directly affect my business.

 

[Philippe]

but are still prefer to keep their old system

So true around here. My clients hate shopping around, then set-up everything back & loose their data.
Most don't even know their email password or how to reset it

 

[sapphirescales]

So true around here. My clients hate shopping around, then set-up everything back & loose their data.
Most don't even know their email password or how to reset it

Curious, do you deal with mostly older people?

 

[Porthos]

If I wasn't targeting professional people and home based businesses, I know I'd be in a world of hurt right now.

Exactly. 98% of my clients are just regular home clients not using them for business so now you get how phones and cheap computers really affect me.

They'll likely either need to close up shop or move in the future.

I can't/won't move. I have been here all of my 53 years of life. My rent is only $840 for my 2 bd house and I generally pay about $100-150 eletric and $35 a month for water and sewage.
Do not have to "close up" since I work from home and as long as I am physically able to work on computers I will.

My clients hate shopping around, then set-up everything back & loose their data.

Many times a nuke is needed and users have no choice but to set things back or pay me to do it.

Most don't even know their email password or how to reset it

Also have to figure it out or pay me for the time to assist.