Thinking of closing retail store, stick with businesses.

[RCD_Technology_Solutions]

Good Morning,

I hope this finds you well.

First a little background, I am a computer consultant for many years who purchased a computer store in 2012. Thought this was a good idea to build business, and it was, perhaps still is.

As the years marched on business changes and I was focusing more on business clients than residential. I was also seeing a trend to have MSP Contracts. I looked at my client base and pitched the idea to them and they all agreed. I only pitched to companies with more then 5 Wkst and at least one server. Currently my largest clients have 50+ desktops and 4 servers on average, so it is a nice chunk of change. I also up sell AV, Splashtop, O365 and Backup as add-ons, which that all have. Currently managing 360 machines.

I still own the store and it is operated by 1 FTE and myself. My wife handles the billing and banking...

I have been thinking (For a year or so) since the residential market is in a decline why have the store. Std reasons BB and amazon will undersell everyone, so we get our money on service...
Financially speaking the store pays its way and with a little profit for me at the end of the year, excluding the MSP contracts which is another category in QB. I like to keep the store separate from the MSP / Business clients, I do however pay the FTE from both sides 75% Store and 25% MSP/Business.

A few weeks ago my FTE decided to move on (Which is fine, never fault anyone to do better.) and left a few days ago. Placed a few ads for a new FTE, but the talent is not there and for the talent that is I ask a few basic questions. What is DNS, DHCP and TCP/IP, 95% fail that test.

This leads me closing shop and working out of my house and just to the MSP thing and a few select residential loyal customers.

So what does the Technibble Brethren say?

Thanks!!!!

 

[britechguy]

What is DNS, DHCP and TCP/IP, 95% fail that test.

I guess it depends on what you're expecting to hear. I'm aware of what all these things are/what they do, but if you wanted me to rattle off what the acronyms stand for, I'd not be able to do that off the top of my head after decades in the business.

But to your central question, if you're thinking about closing a retail computer store/service shop, I'd be leaning in the "definitely do it" direction. You can (and many of us do) service the residential and micro business demographics very easily without a storefront, should you wish to do so. And if you don't, you already know that you don't need such for MSP. (And, strangely enough, I just realized when I thought about it that I couldn't immediately bring up the 'P' part for MSP. There are acronyms that become things of their own where you don't think about "the component parts/words" at all).

 

[Metanis]

So what does the Technibble Brethren say?

If you maintain your business number most of your customers will never miss your storefront. You'll reduce your fixed costs and have fewer headaches. But do you have a space in your house to use for the residentials you'll still service? Setting up the infrastructure at home should all be deductible!

 

[Markverhyden]

Personally I never made the dive into brick and mortar. But I seem to remember that there's a number on here who've closed the store front and went mobile and have done well. Store fronts are still viable but you can't have any competition. Otherwise between that and web orders it's a race to the bottom on pricing.

 

[YeOldeStonecat]

We're B2B/MSP. We've always had "an office"...however, we've never wanted "retail store front"...no reason for that high $ per square foot.
Having "an office" is beneficial, have deliveries, have big bench space to line up computers to unbuckle/build/repair, etc. We started out small...2 of us...then 3 of us...then 4 of us....so we did relocate out of a much smaller office, into what we have now...we rent 6x suites in a professional center. It's rather low cost, esp compared to retail store sq footage.

Since we do "B2B/MSP"...I also like having a conference room, sometimes clients like to stop by, sometimes you want a nice conference room to sit down and do stuff in with clients.

Although much of what we do...can be done remotely/work from home, I'm also not crazy about the idea of having lots of boxes delivered every day to my home. I like to separate home...from the office.

 

[RCD_Technology_Solutions]

If you maintain your business number most of your customers will never miss your storefront. You'll reduce your fixed costs and have fewer headaches. But do you have a space in your house to use for the residentials you'll still service? Setting up the infrastructure at home should all be deductible!

Thank you, Yes I have a detached 2.5 car garage with a second floor. The upstairs is my Office/ Music Studio. The downstairs is storage and work bench. There is bathroom and Heat / AC. So I was planning on using that space for the needed stuff (Self hosted Screen Connect and Backups when working on computers.). Building computers and storage of stock items.

 

[RCD_Technology_Solutions]

We're B2B/MSP. We've always had "an office"...however, we've never wanted "retail store front"...no reason for that high $ per square foot.
Having "an office" is beneficial, have deliveries, have big bench space to line up computers to unbuckle/build/repair, etc. We started out small...2 of us...then 3 of us...then 4 of us....so we did relocate out of a much smaller office, into what we have now...we rent 6x suites in a professional center. It's rather low cost, esp compared to retail store sq footage.

Since we do "B2B/MSP"...I also like having a conference room, sometimes clients like to stop by, sometimes you want a nice conference room to sit down and do stuff in with clients.

Although much of what we do...can be done remotely/work from home, I'm also not crazy about the idea of having lots of boxes delivered every day to my home. I like to separate home...from the office.

Thank You, I do like having the space to work from away from home, I have 900 St FT @ 1450 a month, not too bad,.... But I have space at home (Detached 2.5 car garage.....) But 17K in my pocket from not paying rent....seems better.

 

[RCD_Technology_Solutions]

I guess it depends on what you're expecting to hear. I'm aware of what all these things are/what they do, but if you wanted me to rattle off what the acronyms stand for, I'd not be able to do that off the top of my head after decades in the business.

But to your central question, if you're thinking about closing a retail computer store/service shop, I'd be leaning in the "definitely do it" direction. You can (and many of us do) service the residential and micro business demographics very easily without a storefront, should you wish to do so. And if you don't, you already know that you don't need such for MSP. (And, strangely enough, I just realized when I thought about it that I couldn't immediately bring up the 'P' part for MSP. There are acronyms that become things of their own where you don't think about "the component parts/words" at all).

Thank You, I generally ask the acronyms to the new breeds, to see what school taught them, DNS domain name service, great you can regurgitate, but what does it do, usually gets them.....Only a few actually grasp the concept.

 

[YeOldeStonecat]

Thank You, I do like having the space to work from away from home, I have 900 St FT @ 1450 a month, not too bad,.... But I have space at home (Detached 2.5 car garage.....) But 17K in my pocket from not paying rent....seems better.

Sounds closer to retail store pricing. But if it's just your wife and you, yeah makes sense.
There are 6x of us. But back when it was...3x of us, having a central office became desirable. There are 6x of us now! And every single day...quite a few boxes delivered, laptops, workstations, monitors, lots of Ubiquiti network equipment, every other month or so, a big server. Typically at least a half dozen computers rotating each day "on the benches" that our service tech is working on. I couldn't imagine where to put all the empty boxes at home, I already have enough to break down from my wifes Amazon deliveries...LOL. Not to mention the pile of "retired computers" we build up each month...to further pile up in a boneyard room...eventually a few trips to the scrapyard each year.

But 17K for 2 people...yeah what's why we chose non-retail office space. And we pay less than that now for our 6x suites..for the 6x of us
For 2x of us I'd happily pay 1/3 of that though!

There's an advantage to collaboration across the team when together. Showing someone how to setup things, build things, multiple people working on a project, hovering over someones shoulder who needs help, etc.

A key for us also, was:
*Close parking
*Ideally on ground floor...as our first office was on the 6th floor, and that sucked when carrying lots of stuff, servers, etc
*As close to the main east/west and north/south highways as possible...quick for driving to clients
*We also have a large storage locker (there is a storage facility onsite here)...where we keep lots more stuff

...I like my garage space for "at home" work space...restoring old Harleys, currently fixing up a Wrangler Jeep for wife, etc.

 

[callthatgirl]

I used to support many residential clients and then one day I realized all my clients were all business or retired business executives. I had to do the math and wondered how this happened. Then it dawned on me, I raised my prices many times since I went remote only in 2013.

I don't do MSP but I recommend raising prices as you'll be offering more elite services.