Selling Custom PCs Locally

[0roo0roo]

Originally posted by: TidusZ

Originally posted by: Modelworks

Originally posted by: 0roo0roo


anyways the last deal on woot was a 149 dollar eeepc. how do you compete with that.

Or systems like this:

? AMD Athlon X2 2.6 GHz processor (Qty 1); 3 GB DDR2 SDRAM
? 160 GB hard drive; DVD±RW / DVD-RAM; Gigabit Ethernet
? Microsoft Windows Vista Business / XP Professional downgrade
? 1 year warranty


All for $399


Its gotten seriously cheap for a halfway decent system. Good for the consumer, but bad for the independent builders.

$66 Athlon X2 2.7ghz
$55 4gb ddr2-800
$64 500gb 7200rpm
$28 DVD±RW + DL
$60 Gigabyte GA-MA74GM-S2 mATX (gigabit lan)
$65 Gigabyte Radeon hd 4650 1gb
$40 Chant MicroATX Case w/ 500w p/s
$378 + 5% gst = $397 Cdn --> $352 Usd
399 + 6% tax = $423
423 - 352 = $71Usd difference
Shipping cancels each other out

This is without a markup. I could charge a $50Usd markup (10-15% based on shipping) and still offer a far superior rig at $21 savings. The catch is I can't include windows vista and be competetive, but I think someone thrifty enough to be buying a $400 pc knows well enough to not spend half that on an OS. Sounds pretty good to me. The cheaper you go the harder it is to compete with OEMs though that's for sure.

yea....
+$125 vista business oem= you lose. there is no "anyone "knows" not to spend" bit on the os, it comes with the $399 pc just fine. what you've done is the pointless once again, tweaked the specs at the expense of having a usable out of the box pc. just seriously missing the point.

 

[TidusZ]

I dedicate my 1000th post to you 0roo0roo, you made the signature!

 

[Zap]

Originally posted by: TidusZ
Definitely not going to buy Acronis for each customer, that wouldn't be necessary. The one pirated copy I have is all I need and there is no way for the customer to know any differently.

This thread has some good discussion so I'd hate to have to lock it due to discussion of software piracy.

TidusZ, I have a suggestion. Download and play around with CloneZilla. It is free software that will do what Acronis does (but perhaps not as easily/intuitively). I've used it before for basic cloning and it was pretty easy. I've read that it is a bit more involved to backup images but it is possible to make an image on a bootable DVD for easy restoration. All you need is to figure it out one time and after that you have legally free software you can use forever!

Originally posted by: TidusZ
Flyer

Likely going to print it in black and white but if it looks like shit I may do some colour.

Color will increase your costs exponentially. Just go to your local copy center or office superstore and see what they charge for a B&W copy versus a color copy. Around here it is probably 5¢ for B&W and 50¢ for color. Printing them on your ink-jet printer will probably cost even more.

The "Gaming Rig" you listed looks like a decent collection of parts. I can't quite say the same for your "Office Desktop" system. What do people want in an office computer?
- Small
- Quiet
Your proposed setup is neither. The Antec 300 case is a big, noisy dust magnet. If you HAVE to use a normal ATX motherboard, use a more business-oriented chassis like the Antec Sonata series. They have a sleeker look to them and are designed to be quiet. As an added bonus most of those models come with a decent and quiet Antec power supply. Speaking of which... if that Cooler Master 500W unit is one of those "Extreme Power" units then it will be noisy.

Alternately, use an Antec NSK3480. It is micro ATX and comes with an EarthWatts PSU. Just find some nice micro ATX motherboard with DVI output and you're set. If you do go with integrated video, then you can go to the extreme and use an Antec Minuet chassis. It is a slim-line micro ATX. Seriously though, I used to work for a big company and guess what they used for all their non-engineering systems? Slimline Dell computers. They are small and quiet.

Also, do you even need to list exactly what brand goes into the computers? Gamers might care, but that would just confuse Joe Sixpack (AKA average computer user). Someone wanting to buy an accounting computer for their small business or a grandmother wanting to buy a computer for emailing her grandchildren would not care about the RAM latencyor which model Asus motherboard you used. For that kind of target audience you probably want to leave out all those nasty details. Have that information ready in case someone asks you, but keep it simple for the more basic system.

 

[TidusZ]

Originally posted by: Zap

Originally posted by: TidusZ
Definitely not going to buy Acronis for each customer, that wouldn't be necessary. The one pirated copy I have is all I need and there is no way for the customer to know any differently.

This thread has some good discussion so I'd hate to have to lock it due to discussion of software piracy.

TidusZ, I have a suggestion. Download and play around with CloneZilla. It is free software that will do what Acronis does (but perhaps not as easily/intuitively). I've used it before for basic cloning and it was pretty easy. I've read that it is a bit more involved to backup images but it is possible to make an image on a bootable DVD for easy restoration. All you need is to figure it out one time and after that you have legally free software you can use forever!

Originally posted by: TidusZ
Flyer

Likely going to print it in black and white but if it looks like shit I may do some colour.

Color will increase your costs exponentially. Just go to your local copy center or office superstore and see what they charge for a B&W copy versus a color copy. Around here it is probably 5¢ for B&W and 50¢ for color. Printing them on your ink-jet printer will probably cost even more.

The "Gaming Rig" you listed looks like a decent collection of parts. I can't quite say the same for your "Office Desktop" system. What do people want in an office computer?
- Small
- Quiet
Your proposed setup is neither. The Antec 300 case is a big, noisy dust magnet. If you HAVE to use a normal ATX motherboard, use a more business-oriented chassis like the Antec Sonata series. They have a sleeker look to them and are designed to be quiet. As an added bonus most of those models come with a decent and quiet Antec power supply. Speaking of which... if that Cooler Master 500W unit is one of those "Extreme Power" units then it will be noisy.

Alternately, use an Antec NSK3480. It is micro ATX and comes with an EarthWatts PSU. Just find some nice micro ATX motherboard with DVI output and you're set. If you do go with integrated video, then you can go to the extreme and use an Antec Minuet chassis. It is a slim-line micro ATX. Seriously though, I used to work for a big company and guess what they used for all their non-engineering systems? Slimline Dell computers. They are small and quiet.

Also, do you even need to list exactly what brand goes into the computers? Gamers might care, but that would just confuse Joe Sixpack (AKA average computer user). Someone wanting to buy an accounting computer for their small business or a grandmother wanting to buy a computer for emailing her grandchildren would not care about the RAM latencyor which model Asus motherboard you used. For that kind of target audience you probably want to leave out all those nasty details. Have that information ready in case someone asks you, but keep it simple for the more basic system.

Ty for the tip on the clonezilla, I will definitely check this out. I agree with you about the office desktop, I think I can bring the price down and make it more of what an office desktop should really be - I'll make the changes in the morning. I already took out the overzealous descriptions of the components in respect to brand - I left in Asus and such because the picture clearly showed an Asus monitor, but otherwise I am taking those out. Ty for the tips I will definitely make those changes, I imagine I can bring the cost of the office pc down substantially with a cheaper videocard, smaller case and p/s.

 

[M0RPH]

In my opinion you are doing the average person a disservice if you convince them to buy your office desktop over a Dell. First off, you keep dissing Dell for the quality of their components, but that's just you being a snobbish enthusiast... in truth there's nothing wrong with the parts in a Dell. They sell and support millions of computers so they're not gonna use junk parts. They choose parts for reliability and stability, like Intel motherboards.

Compared to a Dell, your computer is going to be big and heavy and noisy. It's gonna look boxy and home-built and will have less perceived value than a sleek and sexy Dell system. The average person doesn't care about the supposed higher quality parts used inside. And again, In my opinion your parts are not any higher quality than Dell's OEM parts. Yeah, maybe your motherboard has overclocking features or fancy heatsinks and colored risers. Maybe your memory has good timings and your PSU is built like a tank. The average person doesn't want or need this in a low/mid-end system.

So, if friends and family ask me whether they should buy a computer from Dell or from the guy who left a flyer, I'm going to tell them unequivocally... buy from Dell! They will get a better deal, especially with a good sale, and they will get a rock-solid warranty and support. And they will always get a legitimate OS with the computer.

As far as I'm concerned, for low/mid-end systems, the independent builder/seller has gone the way of the dodo, and the world is better off for it. I do think that for high end gaming systems there's still room for the independent builder/seller, but as has been said before, many of the people this appeals to are gonna do it themselves.

 

[0roo0roo]

mostly, someone that specs such a thing as an office computer doesn't know what they are doing. its a matter of judgment.

 

[Blain]

Originally posted by: TidusZ
I would really love to prove the naysayers wrong, theres no short supply of those.

Sounds like TidusZ has carefully considered all the pitfalls & benefits and is ready to proceed.
All that's left now is to bookmark this thread for reference a in one year.

A followup "Year In Review" thread should prove to be very interesting.

 

[unfalliblekrutch]

Originally posted by: M0RPH
In my opinion you are doing the average person a disservice if you convince them to buy your office desktop over a Dell. First off, you keep dissing Dell for the quality of their components, but that's just you being a snobbish enthusiast... in truth there's nothing wrong with the parts in a Dell. They sell and support millions of computers so they're not gonna use junk parts. They choose parts for reliability and stability, like Intel motherboards.

Compared to a Dell, your computer is going to be big and heavy and noisy. It's gonna look boxy and home-built and will have less perceived value than a sleek and sexy Dell system. The average person doesn't care about the supposed higher quality parts used inside. And again, In my opinion your parts are not any higher quality than Dell's OEM parts. Yeah, maybe your motherboard has overclocking features or fancy heatsinks and colored risers. Maybe your memory has good timings and your PSU is built like a tank. The average person doesn't want or need this in a low/mid-end system.

So, if friends and family ask me whether they should buy a computer from Dell or from the guy who left a flyer, I'm going to tell them unequivocally... buy from Dell! They will get a better deal, especially with a good sale, and they will get a rock-solid warranty and support. And they will always get a legitimate OS with the computer.

As far as I'm concerned, for low/mid-end systems, the independent builder/seller has gone the way of the dodo, and the world is better off for it. I do think that for high end gaming systems there's still room for the independent builder/seller, but as has been said before, many of the people this appeals to are gonna do it themselves.

This is it in a nutshell. There's no reason to compete with dell/hp in this market segment because they have economies of scale. If you will be offering pirated OS and software, you are truely doing your customers a disservice. You also stand to get in a considerable bit of trouble if you start selling quite a few of these computers. While I wouldn't be too concerned with getting caught, if I were in your position, I would be concerned with angry customers who find out later their software or OS is pirated and I would be concerned with my own conscious knowing I profited money-wise from something illegal. IMHO, selling pirated software is much worse morally than simply using pirated software yourself, which is something I already look down upon.

 

[lxskllr]

I built a CAD machine at my old employment. They had bought 3 Dells previously without consulting me first. I built the 4th one, and I had a budget of $1795. I built a more suitable machine that was faster in every way that mattered, and I made a couple of hundred on top of that. I still have 2 years left on the 3 year warranty I gave, but I'm confident there won't be any claims on it. This was kind of a special situation due to me working for the company. I wouldn't expect any old company to choose my builds over a Dell, due solely to the fact that they don't know who the hell I am.

 

[WackyDan]

Originally posted by: Blain

Originally posted by: lxskllr

There's more money in nursing.

Not in Canada there isn't. _ But lets not start a spin on socialized medicine.

 

[elconejito]

Some more advice....

Definitely stay legit. There's no reason not to. Saving a few bucks with a bum copy of windows will do nothing but come back and bite you in the arse later on. "It's the cost of doing business" And like any other business, you just pass that along to your client, lol.

There are free and/or open-source options for imaging software. Google is your friend. And more importantly, if you build several of the same machine you can actually have a standard image you use. Which makes troubleshooting/reinstalling much easier.

Also, there is no way you're going to compete with the big OEM's at the 3-500 dollar mark. Just the parts alone will cost that much. And someone who is eye-balling a $399 machine will simply not understand that for an extra $100 you can get better performance, quality, whathaveyou. Don't even bother.

Where you can compete in the home/home office/office realm is in those people looking at the 700-1000 OEMs. Those people who need more of a machine than just email and firefox. Maybe they're accountants, or entry-level designers, whatever, but they just need more horsepower and are willing to pay a few extra bucks for it. In that arena you can offer better bang for buck. But your margins will still be very low on the equipment. You can upsell those people on service agreements though, to increase margins.

I agree also on a case like the Antec 300 not being a good choice for an office. They want small, quiet, reliable. Integrated graphics is the way to go unless they're doing graphic design. mATX AMD 780G or an Intel G31 for example is *more* than enough.

For the flyer, office machines really don't need all that detail. The main points you hit are processor, ram and hdd. Make a tag next to the price "monitor, keyboard, and mouse included!" Because thats a big selling point. Then underneath in small print put the price without monitor, keyboard, mouse. As a minor suggestion, put the text at the top and the computer configurations at the bottom. The first time you build one, make the effort to take some product shots. It will look better than a collection fo product shots from manufacturers.

Good luck. I not sure you'll be able to make full-time $$$ out of it, but could be a nice side business for you. Let us know how you get one and if the negativity or positivity won out.

 

[tcsenter]

Originally posted by: TidusZ
Anyone have some tips for doing this? Anyone done it themselves? Right now my main concern is getting customers, I just started with this today and I"m not working atm so I have all my time to devote to this. I am excited with the prospects here, I really enjoy making computers and being able to make 150-200 a pop seems really good if its manageable.

I've been where you are going, let me give you some advice. Plan to make at least 50% of your business from computer services until you have an established business. Unlike computer services, which primarily leverages your intellectual property at little to no recurring cost (i.e. knowledge and skill), the hardware end requires capital and an understanding of what you can actually sell (as opposed to what you think you can sell but do not know).

You don't get to decide whether you will compete with Dell, HP, or boutique builders such as Alienware and iBuyPower. The customer gets to decide who will be competing for their dollars. Right now is a great time to get your foot in the door with value-oriented computer services. People are more willing to spend $50 ~ $100 to have their computer serviced rather than put an new computer on a credit card than they would be during a good economy. When the economy starts to pick up and people become more willing to buy that new system, you will have six months or so under your belt, and a much better understanding of where and how to expand into system building.

 

[lxskllr]

Originally posted by: tcsenter
People are more willing to spend $50 ~ $100 to have their computer serviced rather than put an new computer on a credit card than they would be during a good economy. When the economy starts to pick up and people become more willing to buy that new system, you will have six months or so under your belt, and a much better understanding of where and how to expand into system building.

On this line of thinking small upgrades can lengthen the usable time for an old computer. Customers would appreciate knowledgeable advice on the best course of action. A modern HD and some more ram will pep up an older machine without costing a fortune. If you treat people right for the small things, they'll come back to you for the big sells.

 

[TheStu]

Originally posted by: lxskllr

Originally posted by: tcsenter
People are more willing to spend $50 ~ $100 to have their computer serviced rather than put an new computer on a credit card than they would be during a good economy. When the economy starts to pick up and people become more willing to buy that new system, you will have six months or so under your belt, and a much better understanding of where and how to expand into system building.

On this line of thinking small upgrades can lengthen the usable time for an old computer. Customers would appreciate knowledgeable advice on the best course of action. A modern HD and some more ram will pep up an older machine without costing a fortune. If you treat people right for the small things, they'll come back to you for the big sells.

What I tell my customers is that the absolute cheapest, fastest thing they can do that will offer tangible performance benefits is upgrade the RAM. Especially if they are running at minimum. I am talking 96 MB of RAM in XP (upgraded to 512MB, thing flies compared to before). 1GB up from 512, that sort of thing.

However, there is a 'saturation' point if you will. I have 4GB in my home system, doubling it to 8GB will not give me any amount of performance boost.

 

[lxskllr]

Originally posted by: TheStu

What I tell my customers is that the absolute cheapest, fastest thing they can do that will offer tangible performance benefits is upgrade the RAM. Especially if they are running at minimum. I am talking 96 MB of RAM in XP (upgraded to 512MB, thing flies compared to before). 1GB up from 512, that sort of thing.

However, there is a 'saturation' point if you will. I have 4GB in my home system, doubling it to 8GB will not give me any amount of performance boost.

Absolutely. A larger HD also adds pep without increasing cost significantly. I overspecced the HD for the machine I built in my previous post. The 250gb drive I chose was faster than the 80gb Dell used. The prices are comparable, so it's like getting free space, and performance. It's these small things that you can use to differentiate yourself from the big oems.

You can also spec out different software. Foxit for Adobe reader, free Avira instead of McAfee. You should document all of your choices, state why you made these choices, and give tips on proper usage. A little time up front leads to a better customer experience.

 

[Zap]

Originally posted by: lxskllr
I built a CAD machine at my old employment. They had bought 3 Dells previously without consulting me first. I built the 4th one, and I had a budget of $1795. I built a more suitable machine that was faster in every way that mattere

At $1800, of course a custom system can beat a Dell. Try doing that at $500. That's the point. Nobody said anything about the "Gaming System" config. It was the "Office System" that was the issue.

That's the great thing about building gaming rigs - everyone else has such a huge margin. Of course the bad thing is that 95% of gamers think they can build their own, so you have to target the remaining 5%.

 

[lxskllr]

Originally posted by: Zap

Originally posted by: lxskllr
I built a CAD machine at my old employment. They had bought 3 Dells previously without consulting me first. I built the 4th one, and I had a budget of $1795. I built a more suitable machine that was faster in every way that mattere

At $1800, of course a custom system can beat a Dell. Try doing that at $500. That's the point. Nobody said anything about the "Gaming System" config. It was the "Office System" that was the issue.

That's the great thing about building gaming rigs - everyone else has such a huge margin. Of course the bad thing is that 95% of gamers think they can build their own, so you have to target the remaining 5%.

I agree, but there's more than 1 kind of office machine. The one I built was an office machine, just not MS Office ;^)

If you target higher end users you can beat the oems. You have to know what the software requirements are, and be able to spec hardware appropriately. The previously mentioned Dells were specced with Quadros. That was overkill for the kind of CAD work we did. By substituting parts, I was able to include a 24" monitor(very useful for CAD), and a MX Revolution mouse. I also made some software substitutions that were more applicable to our setup. The end result was everyone was jealous of the computer I built, and the user was very happy with it. A happy user is a productive user :^)

 

[0roo0roo]

companies are more worried about down time than saving a few bucks getting a machine of unknown quantity. engineer/technical workers +downtime= any savings wiped out very quickly.

 

[Ksyder]

Just read through this thread and was highly entertained by it. All of you guys did a great job of breaking this down. A couple of other points also:

1. Have seen many Dell/HP etc systems break down out of warranty with little recourse due to the fact that they were some form of BTX or there was some other obstacle that turned these systems into door stops. Obviously many times the cost of a replacement OEM motherboard or proprietary PSU is way more than what it is actually worth and probably has the same inherent problem that caused it to go bad in the first place (Nvidia chipsets for instance) It is certainly alot easier and cheaper to repair a system that is based on industry standard parts. This could be a possible selling point. However, using standard atx parts means you'll be running more fans than these Dell and HP systems. This is yet another failure point as well as a noisier system. You will notice that the Dells of the world are often quieter than the equivalent white box system.

2. To build the cheapest possible system means you will be using a cheesy power supply and case. Just to add a nice case and psu probably costs nearly $100. The shipping alone of these are expensive. As someone mentioned above, I wouldn't go with much less than an Antec Sonata if I was going to build a QUALITY system and I certainly wouldn't be secretly installing pirated software. All of these things cost money, and its nearly impossible to beat the big companies on price.

3. Certain small advantages exist when you spec the systems out yourself, such as adding DVI. The lowest end computers don't usually have this. Having a nice LCD without using DVI is doing a disservice to the customer IMO but many people would not know this. This is where you as the expert can come in. You aren't really just selling a box of hardware, you are giving the buyer a platform that can hopefully be upgraded and provide a quality platform, rather than the disposable computers that you can buy at Walmart. That is an advantage that is gained by spending the extra dollars on hardware. (although I do recognize that at $970 for your office machine, TidusZ, you aren't at the low-end that I'm talking about)