THere's a few stores in the upper living area, like malls, and I see them selling things I find really cheap on newegg. The question is, how much is an average rent for a place like that, there's a place near my house but there's no number, and would the profit outcost the expenses ?
How much to set up a computer store ? And how much profit ?
- Thread starter darkmandaddy
- Start date
Proprioceptive
Golden Member
- Feb 27, 2006
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Go talk to some local places. See if their owners will give you some insight. If you're genuine and nice about it, they'll usually help a little, but obviously not too much.
Unless they're doing incredibly brisk business independent retailers usually need to be making somewhere in the 30-40% range over the cost of their merchandise to keep the lights on. Places like newegg probably settle for the 15-30% range + discounts for buying in large quantities because of the volume of business they do. Profit wouldn't initially outweigh the expenses. If you can hang around for a couple years or so you'll recoup costs and become profitable, provided you can drum up some decent business. Computers and electronics seems like an awfully cutthroat market to me though. You might have to settle for lower margins to draw folks away from internet and larger b&m stores. That's extremely hard for a small business to do.
Every expense must be factored into the selling price of your merchandise, including the potential for losses due to unsold or sold-below-cost inventory. Also, most of the vendors you receive merchandise from will have minimum purchase requirements for opening a new account. Given the volumes that they likely sell, that minimum purchase could be in the 1000s of units or tens of thousands of dollars, but it's the best way to get your stuff at the lowest prices possible as opposed to going through other resellers who will add their own markups. All this means that your prices almost certainly have to be higher than what you can get in a thousand places on the internet in order for you to keep the doors open. I certainly would NOT want to take on a new computer/electronics store as owner or manager.
Every expense must be factored into the selling price of your merchandise, including the potential for losses due to unsold or sold-below-cost inventory. Also, most of the vendors you receive merchandise from will have minimum purchase requirements for opening a new account. Given the volumes that they likely sell, that minimum purchase could be in the 1000s of units or tens of thousands of dollars, but it's the best way to get your stuff at the lowest prices possible as opposed to going through other resellers who will add their own markups. All this means that your prices almost certainly have to be higher than what you can get in a thousand places on the internet in order for you to keep the doors open. I certainly would NOT want to take on a new computer/electronics store as owner or manager.
JMapleton
Diamond Member
- Nov 19, 2008
- 4,179
- 2
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Most important thing about a business is location. I always thought it would be a great business to set up in a mall and sell a small selection of common computer parts and then computers in modified cases with all the led lights and have them moderately overclocked right out of the box.
With a recession coming, this is probably the worst time to start a computer store. Computers are one of those things that can be fixed up to "restore" speed with restores, defragments, and all that and don't need to be updated that frequently.
Thanks, I was thinking $300 + $200 for utilities per month.
If I buy and sell laptops, and make $100, then only need to sell one laptop a week. Maybe for desktops too.
On the side, build custom desktops and sell barebone for $25-50 profit.
Sell Windows software, maybe $25-$30.
So, technically, I need to make about 500/4 = 125 a week profit in order to keep it up.
5 motherboards on display - 5 in stock of each. I would estimate that the cost will be like $2500.
5 different CPUs, 5 stock
$5000
I'd have 10,000 money to invest, if it doesn't sell, I guess I need to sell them for discounts.
Is this too linear ? What do you guys think ?
If I buy and sell laptops, and make $100, then only need to sell one laptop a week. Maybe for desktops too.
On the side, build custom desktops and sell barebone for $25-50 profit.
Sell Windows software, maybe $25-$30.
So, technically, I need to make about 500/4 = 125 a week profit in order to keep it up.
5 motherboards on display - 5 in stock of each. I would estimate that the cost will be like $2500.
5 different CPUs, 5 stock
$5000
I'd have 10,000 money to invest, if it doesn't sell, I guess I need to sell them for discounts.
Is this too linear ? What do you guys think ?
Rent here is $300 for an apartment, guessing it would be the same for store, but I'm just throwing it out there.
I wouldn't even think about it without at least tens of thousands of dollars in start-up money that you're ok with throwing down the drain when your business inevitably fails.
XZeroII
Lifer
- Jun 30, 2001
- 12,572
- 0
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Holy Crap! If rent on an apt is $300/month, then these people can't afford lots of new computers. And you're looking at WAY more than $300/month for a good location. When it comes to business, what is they keyword? LOCATION LOCATION LOCATION. You're looking at a minimum of $1500/month for anything worthwhile if you're lucky. You need to get a lot of business to break even because there are also lots of other expenses. Insurance for one.
Throwmeabone
Senior member
- Jan 9, 2006
- 933
- 0
- 0
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