How do all these different ""custom computer" companies stay afloat

[SavageNuke]

So I know for myself. ive always dreamed of being able to live off the pc's I build nd sell. 

there are so many boutique computer shops. how do they all stay afloat?

also competing with the big names: dell, HP, etc

[Bombastinator]

20 minutes ago, SavageNuke said:

So I know for myself. ive always dreamed of being able to live off the pc's I build nd sell. 

there are so many boutique computer shops. how do they all stay afloat?

also competing with the big names: dell, HP, etc

Mostly they either don’t or they become big computer companies and sometimes they still don’t.

[Shimejii]

Most are owned by a Larger company, so they can afford to do it. 

 

People who buy Origin PCS and stuff dont care about value and money so they overpay by a lot. They make a TON of margin on PCS most of the time. Still its not usually enough to stay in business, even if you make a 1000$ profit on a PC, you would have to sell Thousands upon thousands to make enough to stay afloat.

[SavageNuke]

I kow they cut corners when they can. storage. memory. GPU. I didn't realize that a parent company is prolly the reason. makes cents. 

so much overhead $$

[LogicalDrm]

Building PCs for home users is not their main business. Mostly they do tech support for small business, build office PCs with 3 year full service contract and so on. Networking, backup solutions, tech support for home users. Or even act as official dealer for those bigger companies. And then do custom builds on side of it.

[EL02]

Unlike other countries, here people like to buy pre builts, just because it is cheaper.(by cheaper i mean cheaper by my countries standards for pc prices).

[SavageNuke]

the hardware market sucks outside of the US. from Canada to brazil. there getting screwed.

[AlexTheGreatish]

17 hours ago, SavageNuke said:

there are so many boutique computer shops. how do they all stay afloat?

If the info from when Maingear went public is anything to go off of, barely.

[Lorant]

From running pro formas on various business models over the years, boutique PC shops like those are in our "no f-ing way" column.

 

ROI is tragically low and seasonal.  Competing with big box players is just not something small businesses like that are capable of doing.  

 

They have to partner up, like how Walmart and Costco have... and you lose a lot of control doing so.

[SavageNuke]

2 hours ago, AlexTheGreatish said:

If the info from when Maingear went public is anything to go off of, barely.

from what I deciphered from that. they are barely afloat. 

so they don't partner up. they more like sell parts of the company?

 

[minibois]

I would have to guess many of the A-brand PC sellers (Dell, HP, etc.) don't make a ton of money off their PC's, but rather they make more money off printers and enterprise sales.

Seems like their consumer departments exist purely to get their name out there.

[Uttamattamakin]

2 hours ago, AlexTheGreatish said:

If the info from when Maingear went public is anything to go off of, barely.

one example of how to answer this see page Page 5 and top of page 6.  Then on Page 11 where they talk about finances.   

Most businesses, of any kind, may gross six or seven figures but net profit to the owner is high five or low six figures.   The real advantages come with ... if something about your job sux you have the power to fix it. 

[Tristerin]

Like all things in life, its a cycle.  The day and age of storefronts for a lot of retailers is barely making it - because property is finite, and the price to rent is going up exponentially.  The price for renting where my gym was, went up 800% when my lease went up.  Needless to say I moved to another location but that's life.  If it was affordable to HAVE a storefront, they could be sustainable.  

 

In the business' I have ownership of, 1 owns the property/storefront, only reason it succeeds because zero overhead.  The other, is selling intellectual property so I don't have to invest in making or buying and reselling someone elses widget so rent for this storefront is easily managed.  The third rents locations for 3 day stints, so rent is high, but so is the margins so its worth for us to do this.

[SavageNuke]

4 minutes ago, Tristerin said:

Like all things in life, its a cycle.  The day and age of storefronts for a lot of retailers is barely making it - because property is finite, and the price to rent is going up exponentially.  The price for renting where my gym was, went up 800% when my lease went up.  Needless to say I moved to another location but that's life.  If it was affordable to HAVE a storefront, they could be sustainable.  

 

In the business' I have ownership of, 1 owns the property/storefront, only reason it succeeds because zero overhead.  The other, is selling intellectual property so I don't have to invest in making or buying and reselling someone elses widget.  The third rents locations for 3 day stints, so rent is high, but so is the margins so its worth for us to do this.

a storefront is always good business. lets customers put there hands on stuff before buying. and you can showcase

[Tristerin]

11 minutes ago, SavageNuke said:

a storefront is always good business. lets customers put there hands on stuff before buying. and you can showcase

 

Hell of a confident statement - but quite broad.  Id have to say no, no its not good business.  Its only good business if it makes sense for that individual business however.  Its not this simple.

 

[Jumper118]

they dont, for every company that you see that has succeeded, 1000's of others will have failed. only the best still exist. 

[SavageNuke]

10 minutes ago, Tristerin said:

 

Hell of a confident statement - but quite broad.  Id have to say no, no its not good business.  Its only good business if it makes sense for that individual business however.  Its not this simple.

 

I wasn't implying that I believe a storefront to be the only way. very situational like you said. but I think it couldn't hurt. unless its barren and dirty and doesn't represent you well lol.

ive seen some shady lookin pc storefronts

[Bombastinator]

Just now, SavageNuke said:

I wasn't implying that I believe a storefront to be the only way. very situational like you said. but I think it couldn't hurt. unless its barren and dirty and doesn't represent you well lol.

ive seen some shady lookin pc storefronts

It might hurt.  Storefronts can be very expensive.  Storefronts are generally rented. Buying a physical one is often flat out impossible because they are not for sale. The particular zoning of a property can also effect costs dramatically.  A storefront is not infrequently the greatest fixed cost in a business.  A storefront of some sort is always needed, be it a physical one or an electronic one.  If a business doesn’t gain more from a storefront than it costs it can hurt.  Enough to kill a business.  One of the more famous physical storefronts is Walmart.  Companies don’t sell products wholesale to Walmart who resell them retail.  Walmart does not bear the risk of a product not selling.  Manufacturers get approved by the company to place merchandise in a Walmart.  Approval is quite difficult, and often revoked with little warning.  Minimum amounts of product are also pretty high requiring large financial investment in production on the part of the manufacturer.  This can leave a manufacturer quite vulnerable. It is not uncommon for merchandise in a Walmart to change simply because the manufacturer was driven out of business trying to produce a certain amount of a product at a given cost which they found themselves unable to do.

[Tristerin]

25 minutes ago, SavageNuke said:

I wasn't implying that I believe a storefront to be the only way. very situational like you said. but I think it couldn't hurt. unless its barren and dirty and doesn't represent you well lol.

ive seen some shady lookin pc storefronts

You say PC I say "widget" - they are all the same, there is either a market or not for said "widget"

 

It doesn't hurt - if the net profit outweighs the expenditure.  However when you sell someone elses widget (PC parts) - you are not only buying them slightly reduced market value but then have to price them to make you money and PAY for your storefront.  Id rather sell them from my living room, and the world around says yup its a better way.  Storefronts exists for PCs imho for the ignorant (don't mean this derogatorily) and we are in the final days of Microcenters and Best Buys already.  

[SavageNuke]

I guess it depends on the market your trying to cater to.

[Tristerin]

3 minutes ago, SavageNuke said:

I guess it depends on the market your trying to cater to.

The problem is, there are more people trying to spend the very littlest possible on something than someone who would rather remain ignorant and just purchase prebuilts or have a salesmen "sell them something".  In the day and age of information, one can be a PC guru in very little time - and its more affordable to do it this way (and expendable incomes are shrinking yearly - inflation is not matching wage increases)

[SavageNuke]

ive been selling refurbs of older i3's and i5's and some customs here and there. its slow goin. cant live off it.

ide like to be able to do it for a living though.  people are always looking for a pc as cheap as possible. so I give them that option lol

 

[Bombastinator]

2 minutes ago, Tristerin said:

You say PC I say "widget" - they are all the same, there is either a market or not for said "widget"

 

It doesn't hurt - if the net profit outweighs the expenditure.  However when you sell someone elses widget (PC parts) - you are not only buying them slightly reduced market value but then have to price them to make you money and PAY for your storefront.  Id rather sell them from my living room, and the world around says yup its a better way.  Storefronts exists for PCs imho for the ignorant (don't mean this derogatorily) and we are in the final days of Microcenters and Best Buys already.  

Becomes a question of the definition of “storefront”.  One possibility is to call it the interface between buyer and a seller. If one is selling things from ones living room the storefront can be word of mouth, a website, space bought on a well known website (fulfilled by Amazon is one famous one) or even ebay.  If by “storefront” one means Physical meatspace storefronts with signs and such they are collapsing.  Not for all types of products, but many.  A resteraunt  for example usually needs a storefront.  Even this is changing though with things like bitesquad et. al. providing the high speed delivery not offered by USPS that such products need.  At that point the “storefront” is no longer the “TGI Friday’s” or “Denny’s“ or what have you, it’s the bitesquad website.  The restaurant kitchen becomes simply an assembly plant.

[Kilrah]

1 hour ago, SavageNuke said:

a storefront is always good business. lets customers put there hands on stuff before buying. and you can showcase

Thing is, the number of people who care about putting their hands on stuff and are ready to pay the small extra for the privilege has reduced drastically.

[Bombastinator]

1 hour ago, SavageNuke said:

a storefront is always good business. lets customers put there hands on stuff before buying. and you can showcase

There are real advantages.  They cost though.