Need help with getting into reseller business

[Wiseguy69]

I graduated college last year and have a good job in NYC making a good salary for a new grad(I'm older than most by a few years)... but I hate it. I love computers, building them and reading about new tech. I usually troubleshoot my family and friends' computers better than anyone else. Recently, I've been bouncing around the idea of opening a computer business. (building, repairing, training) I have built computers for money before and have made a decent profit while remaining competitive w/ Dell and others in price. This is something I would really love to do, but have no real experience.
Can anyone advise me on the perils on such a venture?
Is this a viable business to start that will remain profitable?
How do you become an official reseller?
Is there a decent paying job out there that will give me the necessary experience to learn more before I do this?

 

[tcsenter]

Recently, I've been bouncing around the idea of opening a computer business. (building, repairing, training) I have built computers for money before and have made a decent profit while remaining competitive w/ Dell and others in price.

I'm willing to be you haven't done that recently. Competing with Dell, or Compaq, or HP, or Gateway, using "authentic" licensed software and operating systems, offering Toll Free tech support for a year and a three year warranty? Really? I bet not.

Let me tell you, its getting tough, really tough.

Unless you have access to SIZABLE capital resources, I would suggest sticking to the repair/upgrade/consulting/service end of the business, and only sell hardware to the extent that is required for the service job. If you try to compete in retailing hardware and components, you'll get your ass handed to you unless you can buy by the pallet or shipping container, because that's what your major competitors are doing.

As for becoming a reseller, you need to organize a business through your state or county, and obtain a Sales Tax Exemption license or certificate from your state. This allows you to buy from wholesalers and distributors without paying sales tax on your inventory purchase. You still have to collect sales tax from your sales and send it in to the state.

Once you get a Sales Tax license and a business name via a D.B.A. ("Doing Business As", typically obtained through your county courthouse), you can just contact the manufacturer of the products you want to sell and request to apply for a reseller account. They will tell you what you need to do and give you contacts with their authorized distributors.

 

[PAB]

Can anyone advise me on the perils on such a venture?

You will lose your ass.

Is this a viable business to start that will remain profitable?

Sure. Circa 1996.

How do you become an official reseller?

Register with the state, get a dealers license, and then apply for a dist. acct to find that you can find an Athlon XP cheaper from Newegg.

Is there a decent paying job out there that will give me the necessary experience to learn more before I do this?

I'm not sure.

-PAB

 

[amdskip]

Originally posted by: PAB
Can anyone advise me on the perils on such a venture? You will lose your ass. Is this a viable business to start that will remain profitable? Sure. Circa 1996. How do you become an official reseller? Register with the state, get a dealers license, and then apply for a dist. acct to find that you can find an Athlon XP cheaper from Newegg. Is there a decent paying job out there that will give me the necessary experience to learn more before I do this? I'm not sure. -PAB

this is very true!

 

[Zee]

Good luck

 

[DaveSimmons]

Originally posted by: Zeero
Good luck

Thanks, I wanted to point to this but didn't want to spend 10 minutes searching for it.

I'd still say the only real opportunity for an online store are niche PCs: quiet, HTPC, and maybe media server with huge amounts of storage.

For local generic PCs, that's got to be even more brutal than online since you're competing against all the brick-and-mortars and online stores. It's one thing to sell 3-4 custom PCs to acquintances, it's another thing to sell 20-30 a month so you can make enough to pay the rent.

 

[charliebrown]

Its a bad idea to get into the computer business now. Back in early 90's was the time to get in. The technology market has seen its growth and is now a "mature" industry.

HP Compaq just released earnings and they made 0.6% on personal systems - that's less than a 1% operating margin! All their other divisions except printers are losing money. If a company like HP Compaq cannot make money in computers, you probably can't either.

 

[Yzzim]

just how does Newegg have such cheap prices exactly? They must buy everything by the truckloads.

 

[ReiAyanami]

bad economy + low profit margins, unless ur willing to sell top of the line computers for $400 like dell...

and tech supports gonna kill u cuz ppl who buy computers are the ppl who dont know how to build one themselves who are ppl who have the strangest problems...

 

[Xionide]

make the store look good if thats what your planning

 

[Wiseguy69]

Yeah, this isn't something I was going to quit my job for just yet, but I do want to test the market a little. There has to be opportunity somewhere.

 

[optoman]

Do what CompUSSR does, install ram for $45 a pop.