The Wholesale Forums

[killah]

Anyone know how to start a business like that selling computer stuff, they have an anual turnover of 220million pounds.

[greedyboy]

There is not formula.

You need to either start small and think big, get some serious investment and be an astute businessman.

Even with all three and some luck will not guarantee you the same success.

[PT]

Like GB said, start small and think big.

I'm sure eBuyer didn't start out with a £220 million turnover, so don't expect to get to that stage over night.

You need to think whether you can offer anything different/ better that your competitors (eBuyer, Overclockers UK, etc.), to copy their business model would not be the right thing to do.

[drum_dude]

Originally Posted by killah

Anyone know how to start a business like that selling computer stuff, they have an anual turnover of 220million pounds.

They may have a turnover of 220million but do you know what the net profit was? I know many companies in the world that have this kind of turnover - some make huge losses whilst others just make huge profits! Turnover isn't really a good indicator of how well a company is doing - Ford in the US has a massive turnover bet their losses are huge too!

Just my two cents...

[Pete]

Very astute, drum_dude.

I am not suggesting this, but you could write an ebook and put it online and make a hundred thousand on it, or you could have a business like Ford and lose your butt.

Their banker makes money, their advertsing agency makes money, the people selling them components make money, but the guys handling the millions and billions don't make money.
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[killah]

Well i am really intrested in computers doing a computer course at college and always done about computers so i want my business to be in computers and its an area where profit can be made but the problem is competition everybody and there mamma is selling computers.

[drum_dude]

Originally Posted by killah

Well i am really intrested in computers doing a computer course at college and always done about computers so i want my business to be in computers and its an area where profit can be made but the problem is competition everybody and there mamma is selling computers.

But you haven't found out Ebuyers profit yet?

[markbyrne]

Agree with Pete. I still think the margins in IT are miniscule. IT and computing is my profession, but I wouldn't attempt to make a business out of selling IT products.

If you were to scale ebuyer down to a small business on the high street, (which is what you'd probably have to start out as) they probably wouldn't last more than a few years. I've seen probably 3 open & close in my locale because they just don't get the kind of sales volume they need to cover the overheads. You have to be very savvy about your suppliers to get anywhere.

I know the manager of one large National PC & accessory retailer in Doncaster who has always imported the majority of his stuff within the EU. Thats the only way he could create a margin big enough to survive. When DVD Writers were new out, he imported them from Denmark initially, and even though they slumped in price, his margins were still great, because he worked hard at maintaining his relationship with the supplier.

[drum_dude]

Originally Posted by pwn Interactive

If you were to scale ebuyer down to a small business on the high street, (which is what you'd probably have to start out as) they probably wouldn't last more than a few years. I've seen probably 3 open & close in my locale because they just don't get the kind of sales volume they need to cover the overheads.

We had one PC shop open on the High street where I live - they lasted 6 months!! I really don't know what possess these people to start up PC Repair/Sales businesses on a high street, especially when there is a PC World in the town! It's like the 4th one to go bust in 5 years.

[Pete]

A recent conversation on another forum -

OP-
i've run a small-mid sized PC build/repair shop for close to 15 years now.. we serve many home, smb and govt clients and remain a pretty big player in my home city. Unfortunetly, the business has gone into the crapper the past few years with shrinking margins, price errosion, etc etc.

I've gotten into more services.. managed services, etc and that is doing well, but the day to day operations of the PC business is killing me.

REPLY -
I'm not in your business, but the best advice I can give is to be very objective about this. You're in a very tough business - ten years ago, my city had no less than six "PC repair shops". We have one now, and he's in trouble. Video rental stores were sort of in your shoes once. So were TV repair shops.

The PC biz is obviously changing. With new PC's being had for less than $500 at Best Buy, and the vast improvements in software, it's simply not worth it to fix/upgrade a PC anymore. And they practically install themselves now.

And as far as sales, I'm guessing competing with online and big box stores is tough... especially since the quality of off-the-shelf PC's are pretty good these days (again, that wasn't true ten years ago.)

You may have to realistically face the fact that the type of business that was your bread and butter at the beginning of the decade may never come back. You may have to get into more "IT services" type offerings (which it sounds like you might be doing.)

I don't mean to sound negative (really). I actually find it a little sad - I loved hanging around those PC repair shops and going to the every other month "computer shows" that came to town. I haven't needed to crack my case in years

PETE -
I had a few comments, as usual. But I'll let the above speak for itself. Things may be a bit different on the other side of the Atlantic, but after a couple of years on TWF I'd think there was pretty much parity in the computer situation.
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