Computer Services

The Idea:
The modern dependance on computers makes it a viable industry to target.

Our dependence on computers makes it a viable industry to target

I need a new idea that is going to start bringing in a more significant source of income than anything I have previously tried if I am going to reach my goal. I’m hoping this one will go some way towards that. The concept is to start up a basic IT company – nothing fancy at first, just things like computer repairs, software fixes/upgrades, tutoring, troubleshooting and so on. I think this probably needs to be done somewhat more professionally than perhaps something like dog walking, for example. As such it would involve setting up a proper company in terms of a name, logo, website and so on. I feel it would be most sensible to focus on individuals rather than businesses, at least at first and seek to build a customer base and reputation in the local area. To keep costs low I will be operating out of my home rather than renting premises, and as such will offer a collection and drop-off service.

Investment Required

This will by far be the biggest project so far in terms of investment. I will need to build a website – costs for this can be kept relatively low as I can do it myself and host it with my existing package. I think to get the right professional image I will need to get a proper logo made. After some research I think for something decent I am looking at about £200 – whilst it is a lot of money, hopefully it will be worth it in the long run. Other than that I will need to factor in the costs of initial advertising materials, this will mainly be in the form of flyers and posters and will be around the £80 mark. Building a professional looking website will take some time, as will the process of advertising and actually doing the repairs. As such this project will command a significant amount of investment in terms of both time and money if I am to go ahead with it.

Capital: £300

Time(hrs): 30 (initial hours – weekly depends upon the level of business I can get, but probably around 5-10)

Return On Investment

If I can get it right, the relatively large investment compared to my existing projects should pale into insignificance once the project gets up and running. In doing some initial market research I contacted or visited quite a few IT repair businesses to get an idea of prices. Many quoted around £45-£60 for a simple software repair and cleaning service. One even quoted £75 which borders on extortion in my opinion. I am confident I could offer this service for around £35 and still be making a decent profit. Obviously there are other aspects to the business, and I’m not going to run through them all now. It is difficult to know with something like this quite how well it will take off, and how much business will be generated. However, I have made some realistic assumptions and run through what is likely to come up with the figures below.

Projected ROI:  966%

ROI inc. labour: 327% (based upon minimum wage of £6.19/hour, and input of 30 initial hours plus 7 hours per week)

Expected Return: £2,900 over the remainder of the year.

Skills/Resources Required

This is probably the first project I’ve undertaken that has significant skill requirements. Whilst it’s nothing too complex, it does require a fair knowledge of computers and how to fix them. Having worked briefly at an IT company doing computer repairs and maintenance, I’m confident I have the knowledge and ability to be able to provide this service. If ever there is a problem I’m not capable of dealing with, I would take it to somewhere that can do it, and act as a broker of sorts to ensure I don’t have to turn away a customer – obviously this will mean I won’t be making any profit on it, but it should help my reputation to grow.

Risk
Offering computer tutoring will be one avenue to explore.

Offering tutoring will be one avenue to explore

This is also perhaps the riskiest project I have looked at so far. The start up cost isn’t huge, but in relation to what I have it is pretty hefty – around 1/3. As such if it doesn’t take off I have lost a fair chunk of the money I’ve worked hard to accumulate. However, I made this money to be able to use it to invest in a way to make more money. There is always risk involved in doing so, and whilst some ideas work, others will doubtless fail. I feel the risk/reward ratio here is at a level I am happy to proceed at. There is also risk involved with dealing with people’s computers as if anything goes wrong then I have not only the cost of that, but also the liability of the persons data stored on the machine. This is unlikely to occur as I have the knowledge to avoid doing anything to put data or hardware at risk of corruption.

Scalability

There is a real potential for growth in this particular project. I am starting fairly small to limit risk, but if things go well it is feasible that I could look to obtain a premises, or branch out into other locations or specialities. I could also potentially look to take on a member of staff if I get enough business, and then I would be looking at a self-sustaining income in some respects. This is all hypothetical and dependant on the success of the initial idea, but it illustrated that there is certainly room to grow with this.

Viability

Whilst it may be the most capital exhaustive and riskiest idea I have considered so far, I feel it is worth going forward with. If things don’t go well, my losses are a fair proportion of what I hold, but are limited. I feel that there is sufficient scope to be able to make it work, and if I can do so the reward is significant. As such I am going to begin to design the website and look to get a logo made. Once I have these I can begin to advertise it and seek to get it going. I will post an update when I am closer to launching with more details.

The Verdict

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