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Old 11-09-2011, 11:05 PM   #1 (permalink)
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Default Computer Business

Hello my name is William and I'm 14 years old. Ever since i built my first computer last year during the winter I knew that's what I wanted to do the rest of my life. I've come to decide that instead of getting a summer job I wanted to build computers for people. I made a list of components, products, item id's, and prices today.

1. Is it legal to sell people computers like this? I know you need a business license if you want to open a store. Is this the same for what I would be doing. I wouldn't be opening a store just building computers than either having people pick them up or shipping them.

2.If #1 is fine how can I attract people to my computers? I need costumers if I wanted to make any money at all. I need to get the word out and advertise my computers. How can I do this?

3.Is my pricing reasonable? This is only one computer I would sell. There are many more I could sell. This particular one is a mid-end gaming desktop. I multiplied the price of each component by 125% and added up the prices of them after that. It came out too $679 so i just marked up the price to $700 to make it even. So do you think this is a fair price for what they are getting?

I would like to conclude with that these computers do not come with monitors, keyboards, mice, operating systems, or any other non-essentials too building a computer. I knew you need an operating system to do anything on a computer but some people might not want windows 7 because they have windows xp and they like it. So tell my what you think, if you think this is a good idea/start, etc.

Mid-Gaming Desktop
Component Product Item Number Price
Motherboard BIOSTAR A770E3 AM3 AMD 770 ATX AMD Motherboard N82E16813138179 $54.99
CPU/Processor AMD Athlon II X3 445 Rana 3.1GHz 3 x 512KB L2 Cache Socket AM3 95W Triple-Core Desktop Processor
N82E16819103872 $74.99
Memory(RAM) G.SKILL Ripjaws Series 4GB (2 x 2GB) 240-Pin DDR3 ADRAM DDR3 1333 (PC3 10666) Desktop Memory N82E16820231275 $31.99
Hard Drive HITACHI HDS721050CLA362 (0F10381) 500GB 7200 RPM SATA 3.0Gb/s 3.5” Internal Hard Drive –Bare Drive N82E16822145299 $99.99
Video Card MSI N550GTX-Ti Cyclone OC GeForce GTX 550 Ti (Fermi) 1GB 192-bit GDDR5 PCI Express 2.0 x16 HDCP Ready SLI Support Video Card N82E16814127573 $139.99
Case Rosewill CHALLENGER Black Gaming ATX Mid Tower Computer Case N82E16811147153 $49.99
Power Supply XFX Core Edition PRO550W (P1-550S-XXB9) 550W ATX12V 2.2 & ESP12V 2.91 SLI Ready Crossfire Ready 80 PLUS BRONZE Certified Active PFC Power Supply N82E16817207013 $69.99
CD/DVD Burner ASUS 24X DVD Burner N82E16827135204 $20.99

TOTAL=$543
PRICE=$700
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Old 11-10-2011, 05:26 AM   #2 (permalink)
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Default Re: Computer Business

Well first of all, no it is not illegal for you to sell computers that you build. As you're 14 lol.

Secondly, buying parts online and creating these PCs are generally cheaper than buying a build from a retail outlet, however they do get OEM licenses for operating systems which make them a little cheaper.

third: its windows 7 or nothing, XP is no longer in production and they do not support any of the older service packs anymore, this is a disadvantage to customers and a great selling point. New technology depends on updates, older operating system = no updates.

Four: because prices are so high in retail outlets, theres never a shortage of people looking to go down another cheaper route so advertise well and the custom will flow, especially if you do a good job.

five. dont just create pcs and expect people to buy them, tailoring the computer to a persons needs (that means chatting with them) gives extra value for service (good for repeat business) and you dont end up needlessly spending money on a sandybridge core I7 for an old lady with a cat who wants to use email.

you'll be paying taxes on the items you buy regardless, if you were a business you could get things ex-vat however you're not. and bear in mind tons of people have the same idea as you, probably more skilled at making a build. before you spend any money check out the market around you, get a friend to help you do a survey in the local community to see whether this A) might be needed and B) there isnt already someone doing it.

hope that helps
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Old 11-10-2011, 08:17 AM   #3 (permalink)
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Default Re: Computer Business

money upfront by the customer.

that might be high for a price.
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Old 11-10-2011, 08:47 AM   #4 (permalink)
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Default Re: Computer Business

Quote:
Originally Posted by DragonComputers View Post
1. Is it legal to sell people computers like this? I know you need a business license if you want to open a store. Is this the same for what I would be doing. I wouldn't be opening a store just building computers than either having people pick them up or shipping them.
Yes it's legal but I would talk to your folks about it because if you're making money off of it and live in the US I think you'd have to keep records for tax purposes and all that jazz, which is something your folks would know more about I would guess.

Quote:
2.If #1 is fine how can I attract people to my computers? I need costumers if I wanted to make any money at all. I need to get the word out and advertise my computers. How can I do this?
I would make a website that says what you're doing and configurations you can get and why they should buy a computer from you and all that jazz.

Quote:
3.Is my pricing reasonable? This is only one computer I would sell. There are many more I could sell. This particular one is a mid-end gaming desktop. I multiplied the price of each component by 125% and added up the prices of them after that. It came out too $679 so i just marked up the price to $700 to make it even. So do you think this is a fair price for what they are getting?
I think that's pretty good, lets assume you have all the parts in house, it takes probably an hour, maybe 2 hours to put the computer together, you'd definitely want to spend some time testing the components, as it wouldn't be very good for business if you ship out computers that die in 20 minutes cause all you did was make sure it posted and made it to the bios and all that. So for your physical labor time you're making $60 an hour, and obviously if you account for testing purposes you're still making out pretty good.

This is great for you, but if a local company is selling computers with similar configurations for $650 with a 1 year parts/labor warranty then you're not going to sell a single computer, so go check out your local shops and see what they're selling prebuilt systems for and see what they've got for added extras like coverage/warranties/etc. Know what you can sell your PC for, and then price yours accordingly but don't get greedy!!!

Quote:
I would like to conclude with that these computers do not come with monitors, keyboards, mice, operating systems, or any other non-essentials too building a computer. I knew you need an operating system to do anything on a computer but some people might not want windows 7 because they have windows xp and they like it. So tell my what you think, if you think this is a good idea/start, etc.
I think it would make sense to have the option to include all the peripherals. Not everyone will be replacing an old tower and have everything else hanging around, especially operating systems. Since almost all HP/Dell/Gateway etc computers don't come with OS disks so if they decide to replace the tower then you're expecting them to install an OS and that in and of itself negates any idea that the cost is cheaper.

I've seen this idea of building pc's for people before, and it makes sense to someone who knows computers. By building one yourself you get higher quality, faster, and better parts for cheaper than your dell/hp/gateway box with no bloatware, no extra crap or anything. the problem is that HP/Dell/gateway etc are multibillion dollar companies who have been making computers for a long time, and most people who aren't buying their own computer like the security of knowing that there's someone they can call up who will fix their computer if it breaks under warranty. For you, you're a single party seller, not to mention you're 14 and no matter how mature and smart with computers you are, you're still 14 and many people will simply disregard your computers as an option because you have no backing other than your word. Your word is fine for your family and friends, and some people, but I wouldn't go into this venture to make a lot of money or substitute for a job. I would be surprised and happy if you built and sold more than 2 pc's a month, just because of the circumstances.

I would certainly do this, just post up on craigslist that you build custom PC's for a price less than a big box stores pc, but go into it with the goal of doing it as a hobby and a chance to build some pc's and see some really sweet parts. Half the fun of building my PC was when the box showed up and I got to unpack my massive GPU and just opening things up.
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Old 11-10-2011, 08:47 AM   #5 (permalink)
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Default Re: Computer Business

Quote:
Originally Posted by DragonComputers View Post
I would like to conclude with that these computers do not come with monitors, keyboards, mice, operating systems, or any other non-essentials too building a computer.
I'd imagine that most people looking for a prebuilt computer will want one with a keyboard, monitor, mouse and OS so I would add those in by default but tell customers that if they aren't needed then you could offer them a discount.
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Old 11-11-2011, 07:54 AM   #6 (permalink)
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Default Re: Computer Business

from what it sounds like your trying to do is build these computers then sell them. You have to remember that it's not cheap to build a computer. How many do you plan to build? What you should consider instead is advertising your computer business to build them for people and to act as a consultant. That is much cheaper for you than buying all the parts and then trying to sell them at mark-up cost. Your client could tell you what he/she is looking for, you give them the quote and build it! For the operating system, buy windows 7 full price and as you get new clients charge them the price of it, but all you would have to do is purchase a key for the windows; So you will be making money off it.. Good luck! When I get out of the Military I am planning on starting up a business as well! For a young kid you have some potential and could be the next Bill Gates / Steve Jobs! Don't let anyone tell you otherwise.
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Old 11-14-2011, 11:16 PM   #7 (permalink)
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Default Re: Computer Business

Thank you everyone who has posted so far. I probably going to put something out on craigslist to attract some people. I might add in windows 7 which will cost $100 w/o taking the price up. I will still be making $50 after that on this build. I also should have clarified before hand that I was not going to build the computers then sell them. Instead I was going to get the order, get the money, then order all the parts and put them together and give it back to the costumer. I will also give costumers the option to order accessories such as the monitor, keyboard, and a mouse. Any other comments are appreciated.
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