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Tech Support Businesses on the Rise
prostoalex writes "People are relying on more technology that ever before, and tech support geek squads are on the rise, media reports. The USA Today article says Best Buy has hired 1,500 more technicians for its Geek Squad and CompUSA currently keeps its tech support ranks at 12,000. The article from Digital Connect magazine talks about Geeks On Call, a nationwide tech support franchise, which has more than 300 shops in 20 states. The USA Today article states the profit margins for the tech support teams generally run within 30%, while the Digital Connect magazine gives an estimate on prices charged to achieve the margins: "An initial diagnostics call, for example, could run $99. Cleanup jobs usually run one to two hours, and some franchisees say they charge between $149 and $165 for one hour and $265 to $275 for two hours.""
Wrong: "should of"
Right: "should have"
Righter: "should've"
I'll turn into a supernova and burn up everything. Well I'll turn into a black little hole and you'll turn into string.
I know for a fact that one of the national big box stores mentioned doesn't have *any* of the thousands of on-site techs in their employment. They subcontract out everything to ComputerRepair.com, which is an interesting business idea in itself. I wrote a tech's perspective review of ComputerRepair.com here.
Entrepreneur : (noun), French for "unemployed"
Running a business is expensive.
I'm the first one to understand this, but $149/hr means that they're considering the "highly trained technician" salary (who's services are what you're paying that much money for) to be only 6.7% of the gross profits. Also consider that gasoline is usually a charge on top of base hourly costs if the distance is substantial. (Which only works out to about $7.50 for a 60 mile round trip, 30 each way, w/ 20mpg and $2.50/gallon.) The car is also considered a tax deductable expense, so it ends up being fairly cheap for the company. (For the 60 mile round trip at $.32/mile, the value of the car is considered to have deprecated by $19.20 and is recouped through tax savings.)
It's not always big mean corporate big-wigs that suck away all the money from the people doing the actual work.
They don't have to be a mean corporation to make a lot of money at the employee's expense. That's why it tends to make fiscal sense to go into business for yourself. The only down side to this tack is that you lose the marketing muscle of a large corporate entity. This can make it harder to get your name out, but can still pay off if you can carve a customer base.
Javascript + Nintendo DSi = DSiCade
Best buy salary is pretty high, a manager of a store was impressed by my t0t4l l337 linux knowledge (I know how to use it). I believe he said something between $14 and $16 an hour.
As an onsite support tech, I can tell you that in a lot of ways, I'd much rather be going to people's businesses (and maybe homes) than talking to them in the store or on the phone.
When on the phone, there's a certain level of anonymity that customers feel they have, and you're much more likely to get screamed at on the phone than while onsite. When you're onsite, most customers are aware that 1.) they need you more than you need them, as they've called you out to their business, and 2.) you're getting paid hourly, so screaming wastes their time and money. Also, 3.) it's kind of unspoken that the people you talk to on the phone aren't as good as the people in the field, or they'd be in the field.
So your assessment about being nicer in person is completely, 100% correct, in my experience. The worst part about going out on site is dealing with customers who don't have a store account. I hate dealing with money, and I'm bad at it. I fix computers, that's it. My wife pays the bills, and our understanding is that if I need it to sustain life, I purchase it, and if not, I ask first. Asking customers for $85 or $135 for an hour of work almost wierds me out. And having to sit down at the computer you just fixed, break out calc, and add up ((parts*1.05)+labor), and show them the total still feels odd. Especially since I see about $15/hr of that.
Every once-in-a-while, though, you do get an interesting customer. Last week, I had a customer who invited me into his townhouse, made a comment about getting his "fat ass out of this chair" (his words), and then stood up, grabbed his crotch, and exclaimed, "Holy Shit, the bag's full!". Just as I was beginning to work that one over in my mind, and coming to the conclusion that he had, indeed, grown a third testis since he sat down, he explained that he had had a good bit of his colon removed, and excused himself to the bathroom to empty his colostomy bag. I began cleaning his spyware in earnest at this point.
You don't gt experiences like that from working in store.
~Will
sig?
Paying for downtime.
The problem is that the Geek Squad are a bunch of people and they are there for quick responce. So inorder to insure quick responce you will need enough Geek Sqaders to ready to respond at a drop of a hat. So that means that you will need to employ more then ones that are actually doing work (or chargable work) A smaller company with less employees can be paid twice as much and chage half the price. But the customer may have to wait 6-24 hours before they can get a responce. Because all the techs have a queue of customers they need to complete. Plus if they are a 1/2 hour drive from the customers house that is a total of 1 hour non-billable time. Then there is the issues of people not paying their bills. And the expense of Gas and travel. Advertising, Cost of all the fancy Bugs with the paint job, uniforms. All this stuff adds up, and the margins are a lot smaller then you think.
If something is so important that you feel the need to post it on the internet... It probably isn't that important.
Right on. It's so much easier to stop someone doing something wrong than to deal with the consequences after they've done it. And if you're there, you can always do it yourself.
While in college, I spent a couple years running the studentweb server, providing personal webspace for students. Sometimes they had to use the space to make websites for classes (business school students mostly), so I'd get a lot of tech support questions.
If I had the time, I always prefered to meet with these people in person to work out whatever problems they had. The nature of computer use is such that it's much easier to show you than tell you. That's why good tutorials have so many screenshots.
Sure, I could write you an email that will tell you how to FTP, but it's much easier to do it in front of you and then watch and correct as you do it yourself. It's so much quicker to point and say, this is the remote server directory listing, click here, rather than write out a description of the window, where it should be on the screen, not knowing for sure what's in it, etc.
Of course, I generally met people for this in public places, computer labs and such. I'd be a little nervous going into the homes of complete strangers, because lots of people are damn weird.
One time I threw a brick at a duck.
The deductibility of the expense of the car, isn't some magic that makes it free. It just means that, as with the cost of the phones and the paper and all the other stuff a businss uses, the dollars spent on those things are not profit, and thus are not taxed.
My boyfriend has been a tech with Geek Squad here in Ohio for a year now and to my knowledge still only makes around $10 an hour. He started at around $9.
Also, there are only 2 slots for full-time tech staff in his store, and neither of them are salaried. All the rest of the staff are part-timers with insufficient hours + pay to even live indepentdently. Most of his fellow techs work another part-time job just to afford the basics.
Not that it is unusual in companies for the people who actually perform the revenue generating effort to see the least of the monetary rewards.
Sacré-bleu! Where is me mama?
Well, the first thing I'd do is call your local competitors up on the phone, pretending to be a customer, and see what they're charging and how they bill. When I did that, I found out a few creative little "twists" to how some firms bill for system repairs. For example, some places claim to charge "flat repair rates" - but actually end up being more costly than firms billing by the hour plus parts. Sometimes, they do such things as billing fixed prices for every piece of the PC they have to remove and replace during a repair job. So if you have, say, an HP Pavilion that needs a RAM upgrade - they might charge $40 "flat rate for power supply removal/installation" because it had to come out to get to the memory slots!
It's good to know such things before going into the business, so at the very least, you can properly inform some people who falsely believe competitor X is far cheaper than you....
I currently charge $60/hr. with a 1 hour minimum, and additional time billed in 20 minute increments. I don't charge any extra travel or trip charges. Most of my competitors bill upwards of $79/hr. and do include some type of travel charge. I live in a major city though... your findings may vary based on location.
The people who think these rates are "extremely high" really don't have a good concept of the costs of doing business. For starters, a basic Yellow Pages ad will easily cost you upwards of $400 per month. If you don't have one of these, you aren't going to really be competing effectively at all in the marketplace. (When "Average Joe" needs his PC fixed, he looks in his phone book to find someone - more often than not.)
Of course, if you're only doing this part-time, maybe you only plan on "word of mouth" referrals or flyers in mailboxes or whatever. That's fine too, but don't forget your costs for gas, oil changes, tires, and other vehicle maintenance for driving around to these calls. Also, you'll need to keep some sort of basic inventory of parts with you. I always try to keep at least 2 256MB PC-133 memory sticks, 2 PC-2700 256MB memory sticks, a DVD writer, a CD writer, a spare AMD Athlon XP motherboard and CPU, an extra ATX power supply, a 3.5" floppy drive, and spare PS/2 keyboard and mouse, along with a Linksys wi-fi router and a spare cable modem. (I was surprised how often I ran into problems with internet connectivity that ended up being the fault of a defective cable modem. It's not a HUGE issue, but I saw it a good 3 or 4 times. It was worth keeping a spare with me for troubleshooting purposes, at least.)