*Jozzua Notes from a Business and Marketing Strategist/Tactician

How To Start A Computer Shop On a Shoestring Budget

"Let's start a computer shop at home."

That's how a conversation with my brother went two months ago. We were sipping cups of cafe americana at Bo's Coffee in Katipunan then.

I said "I'm thinking of a small business we can start. Since you've already managed a couple of internet cafes, I think that would be the best option."

"You'll be the manager. I'll be the financier." I ended with an evil grin.

At the time, I considered it wishful thinking. I didn't really have money on hand and the numbers we played around with weren't promising. Just take a look:

6 Computers @ Php 20k = 120 K
Property repairs = 20K
Miscellaneous expenses = 10K

TOTAL = 150K

Although 150K was not too difficult a number to get, I wasn't too convinced on the return on investment (ROI). A survey of the computer shops in my brother's area indicated the following:

1 computer would earn P15 per hour.
Computers were used almost 10 hours continuously.
Six computers would generate only around (15 x 10 x 6) P600 a day.

I mentally computed this and figured P600 a day, or P18000 per month (600x30) would take me too long to recover. If we took half (P9000) as profit, we'd break-even in 16.67 months (150K / 9K). Over a year.

I dismissed the notion of actually getting this computer shop anytime soon.

Then something odd happened.

Someone contacted us offering to sell PC units worth 10K each. The package included a computer flat screen LCD monitor (Samsung) and a Dell Pentium 4 CPU. Apparently, one unfortunate call-center had encountered some financial troubles and decided to sell off its hardware.

We didn't pass this one up. I took out a loan from family members to get the business started. We ended up with

6 computer units @ 10K each = 60K
Property repairs, cabling, internet = 20K
TOTAL = 80K

In our deal, my brother would need to give me P300 per day to pay off for the loans and investment. Once the initial capital is paid, I'd still get P300 a day as dividend.

Yesterday I dropped by the shop. It was still under construction. Estimated time of completion? One week.

So there's my shoestring P80K internet cafe.

Where this goes, I can only wonder.