toratek

I couldn't have said it better myself. Thank you

tlarkin

170 million dollars of sales means absolutely dick unless we know the profit margin, and since their systems cost an arm and a leg, plus the cost of support and to employ their staff we have no idea actually how much profit they were making.

When I was contracting my rates were $75 to $200 per an hour, that is pure profit per an hour. Which is more money than you will make doing one job than off several hardware sales.

toratek

Since their systems are so expensive (actually there is not value in buying an Alienware System), and they have 170 million dollars per year in sales, you can imagine that their profits are huge. Add to that the fact that they've outsourced everything to South America and China, so they don't have to pay huge wages. But who really cares? No one in the enthusiast community considers them true custom builders anymore. The market will have its say, and one day they will fail and go out of business. Then Dell will discard them to Acer or Lenovo or who knows what company from Asia. Or maybe not? Who cares... they don't bother me a bit.

zach6490

there new laptop is awesome, there not going under anytime soon. Yes their stuff is way overpriced.

Alien Ware

Thanks a lot for all of these well explained posts toratek. I didn't know you used these forums

Alien Ware

Another question toratek... you build all of your custom computer correct? On average how much money do you make per week?

toratek

I largely depends on the number of systems that you're selling. This will be largely up to you, how desirable your product is, and how good the craftsmanship is. Take a look at www.uberclok.com for instance. They make $400/system, but I wouldn't buy one. There is nothing that appeals to them.

Later, Marc.

tlarkin

How much do they spend on advertising every year? I mean they have to spend 10s of millions to put their ads all over the web and in every freaking computer publication out there. Not to mention pay their staff, and manufacture their product. Sure they may make 170 million but in retrospect after you pay for everything how much profit is that?

The system builder I was working for had a bonus pay system where it kept track of every technician by the money they made. I once made the company 28,000 dollars in one week. Of course that was before we took out costs, and my salary, and every other thing that nickels and dimes you. I mean our utility bill for our shop each month was like 45k or something ridiculous like that. That was for power, running water, heat and air conditioning. That doesn't include lease or mortgage either, that was just utilities.

Then you add the cost of overhead, office supplies, office equipment, so on and so forth.

I know that the only reason Dell would buy anyone out (since Dell has been losing money as well) would be because they do it for dirt cheap.

I will say this once more and I am done with this thread. It is very hard to make a living purely off hardware sales because the mark up on them is really low. Plus you have to pay your dues to MS to become an licnesed reseller and OEM systems builder, or they will sue your pants off; and I bet they have way more lawyers than you do. I know this as a fact because a friend of mine worked for local company back in the day that got audited and sued by microsoft for breaking their systems builder LA.

Then you have to compete with everything and everyone else. Try advertising in your local free weekly magazine, every major city has one, a quarter page ad only costs you like $2,000.

I am not trying to crush your dreams I am just trying to be realistic about it. Like I said, if you can innovate some new business model and change it, then do it, however you will make the bulk of your money from supporting your product and charging for your services.

imsati

^ Ditto. I make *maybe* 5% (and that's being super-liberal) of my income by hardware sales (custom-built systems, someone says 'I want a sweet video card added to my system', etc.). The real money is in service, maintenance, and repair (for Home Clients), and in my monthly 'spend a day at their office to repair/add/whatever they need from 9 to 5' for my Small Business ones.

__________________
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http://www.computerforum.com/114761-...tml#post922619

D2jsp

I think this would be a good idea if your willing to put in the time.. I went to college and im still paying back my student loan. Also I would rather buy custom build computers from individuals then major companies because you know that 1 person cares about their company unlike dell, HP, ect.