pc repair business start up questions
i am going to start a home based computer upgrade/repair business, and am
seeking general advice from people with experience in this. i plan to keep
my full time job, and do this on the side. i have been doing free
repairs/upgrades for friends for a few years, and enjoy it enough to take it
to the next step.
i have studied mike's book for a+ cert. and plan to take the tests after i
have generated a little income.
i know i need to warn each customer that they should have all important data
backed up, because data loss can/will occurr, but what other types of things
should i have printed on the contract, for the customer to sign off on?
would anyone be willing to share their standard contract with me?
would anyone knowledgeable in this be willing to answer more of my start up
questions through an instant messenger, until i get going? i'm not looking
for free tech support, just a little home business advice.
Many ppl here have asked about starting their own business, how do you go
about it, what is involved, how much, what licenses, etc....
So, to all who are thinking about starting/owning your own business... Go
get the duct tape now, because you will need to wrap around it copiously
your head to prevent it from exploding.
Depending on your situation, you might be considering starting your own
business rather than working for someone else. Well, let me clue you in
to few things.
Running your own business can be quite profitable- I mean lets face it,
$50.00 an hour to $75.00 an hour is quite attractive. That is of course,
until you start to think about some of the realities of life.
When you go out on your own, you absolutely *MUST* do it right. By that,
I mean you must do it legally. That means getting your occupational
license, getting your ficticious name license (if you are not using your
real name as the business name), getting your federal EIN number, your
state sales tax number, your commercial bank account, your workman's
compensation number, unemployment compensation number, and all the myriad
of other numbers, registrations, and licenses. And do not forget
liability insurance.
Why do you need all this stuff? Well, you only need one unhappy client
with too much time on his hands to drop a dime on you. If you call your
business "PC helper" and you have the clients pay you in cash, or ask them
to write the check out to you personally, they *KNOW* you either do not
have the proper licenses, or you are not paying your taxes! Simply, you
HAVE to pay your taxes. If you are working out of your home, you could
end up losing your business, your home, your vehicle, and any other
property you own if you do not.
What else? Well, I cannot suggest to you highly enough that you
incorporate. Why? Well, you simply *MUST* protect yourself and your
family from civil liability. All you need is one asshole to claim your
actions corrupted his data and now he sues you. If you are incorporated,
they cannot touch your home, your car, or your personal assets, or those
of your family.
Oh, and do *NOT* work out of your house. If your house and your office
are one in the same, then they can come after that too! Even if you only
use a small rental space in a flea market, and use a cell phone as the
business phone. You MUST keep home and office seperate.
But, the important thing, once you incorporate, is you must not co-mingle
funds. What this means is, if the other guys attorney can "pierce the
corporate veil", your personal assets will be up for grabs. What is
co-mingling? Your business monies are your business monies. Your
personal monies are your personal monies- and never the twain shall they
meet. That means, you do not pay your mortgage with your business
account. You do not pay your personal credit cards from your company
account. When you do this, the other attorney can prove to the court the
corporation is a sham and he can now go after you personally.
You need a commercial bank account. And this is going to piss you off.
These bastards charge you out the butt for every activity you can
imagine. First, there are no interest bearing commercial accounts. So,
now matter how much money you have in there, you will not gain any
interest. They charge you for every check, every withdrawal, every
deposit, sometimes even for phone calls if you need help. Now, when you
make a deposit, it is bad enough they charge you for that privilage of
giving them your money, they also charge you for each and every item on
your deposit. So, if you have a deposit with lets say 25 checks, they
charge you perhaps .10 for each check as well! The only good thing is
many banks will waive some of these fees if you maintain a minumum balance
of prehaps 2,000 or 5,000. And they will often waive all the regular fees
for the first 6 months or year of your business.
You make yourself an employee of your company. You pay yourself a regular
salary, taking out all the proper taxes (but do not forget to send them in
quarterly to our Uncle). Put your spouse on salary if you need to, and
even your kids- they can clean up the office, stuff envelopes, or
something. But that is a legal way to get extra money into your
household.
Advertising. The *ONLY* advertising I do is the yellow pages. But,
yellow pages ads are VERY expensive. The phone company is a bigger
parasite than the government- and just as merciless! And, like the
government, they have your ass over a barrel and they know it. So, bend
over, smile, get lots of lubricant, and pretend you like it, cause they
are gonna get you good! My ad runs almost as much as my office rent every
month- and it is not a very big ad (only slightly larger than a business
card)! But, when someone's PC breaks, they are going to the yellow
pages. They are not going to look for a flyer they got 3 weeks ago. They
are not going to look in the newspaper for an ad. They are only going to
the yellow pages- no place else. Make sure your ad is nice looking, and
professionally done if you do not have the talent. Use color even if you
cannot afford it. It needs to stand out.
You might consider doing talks at local computer clubs or neighborhood
associations on various computer issues. Have a nice business card. Do
not skimp here. Once you leave the person you gacve the card to, thats
all they have to remember you by. If your card is amatueirshly made, has
perforation tears on it from the preformed business card templates, or
anything else, it implies the same about you. I get MANY compliments on
my card, and on my yellow pages ad.
By this time you are paying out tons of money for taxes, insurance, rent,
advertising, phones, vendor accounts (where did you think you were going
to buy all your parts?)
You will need someone to answer your phones for you when you are out on
service calls. That person will also have to keep your books and complete
all your paperwork for you- because you will no tbe able to. Why?
Because you will be reparing computers until 2am! Let me tell you how
much THAT will cost. Ya think you will get someone in there you can trust
your business to for minimum wage? Don't count on that, ok? So, lets say
you need to pay someone $10/hr. Can you afford $10/hr? You better plan
on $12/hr. Why? Because besides paying him or her an hourly wage of
$10/hr, you have to pay roughly another $2.00 an hour in employee taxes,
unemployment compensation taxes, and workman's compensation taxes. You
know how you look at your paycheck and see all those deductions for
medicare, social security, and federal withholding? Well, your employer
has to match those amounts and pay them to the fed in taxes. And that
does not include any medical benefits.
Oh, and do not forget your broadband connection- you MUST have one. You
will be needing to regularly DL installer files, drivers, etc. You cannot
do it on a 56k Modem. So there is another $50 bucks a month for DSL or
cable, or $800 a month for a T1.
Then you have a web page. That generally runs perhaps $25 a month.
You should have at least 3 phone lines- 1 for the fax/DSL, another for
incoming, and another for outgoing. You do not want to miss any calls
because your line is busy while you are calling your vendor to order
parts.
Now, with all this, we are not even talking about having a retail store-
for that you need to plan on another $75,000 in stock (merchandise and
parts)- minimum.
You absolutely *MUST* have drive! If you are going to sleep in until
noon, and be home before dinner, forget it. You have to be ambitious, be
a go-getter, and you had better get up and go. You need to work morning,
noon, and night. It is not uncommon for me to be at my office still
repairing computers and catching up on paper work at 11:30 at night. I
have been there till 2am and 3:30am on more than one occasion. Of course,
at those hours, I cannot reach my vendors, the bank, the credit card
merchant, or anyone else- but I am able to get other stuff done.