Tech support parts pricing advice

Discussion in 'Growing and Managing a Business' started by zildjohn01, Apr 26, 2010.

  1. zildjohn01

    zildjohn01
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    I'm starting a local tech support business, and I have a quick question.

    Let's say I was working on your computer, and I needed to order a part to get it working. Would it be fair for me to charge a 5 or 10 percent "convenience" surcharge (fully disclosed, of course), to cover things like finding and dealing with suppliers, handling DOA parts, etc?

    If you were looking for tech support and you noticed this extra charge, would it discourage you from hiring me?
     
  2. Fergal

    Fergal
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    Welcome to our business forum zildjohn01 and thanks for posting your questions. I would say that it would be more than fair for you to charge for sourcing a part. It will take you some time to find, order and then receive the part. Time is money so it is only right that you would charge for this time.

    It really depends on how you do your billing, but I'm not sure that it would be necessary to specify to your customers exactly how much you are charging for this. If you provide good value to your clients, you don't need to tell them exactly how you make up your total charge to them. However, you do need to be ready to give them a breakdown, should they ask for it.

    When asked for a cost breakdown, my experience is that it is better to list the items you are charging for and then give the total cost. If the customer wants the actual costs split between the items, it generally works best to keep the categories as broad as possible. If you give an item by item cost, for every line on your list, customers may question each item and ask if they could have got that individual item cheaper elsewhere.

    Even businesses that provide a service for a lower cost than their competitors, will sometimes charge a higher price for one small part of their service. If you are cheaper for 9 out of 10 items you charge for, you are providing excellent value to your clients and you don't want to start haggling over the one element where you are a little more expensive.
     
  3. miles2152

    miles2152
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    Fergal, I completely agree. The only time I would say an exception should be made is if you are going to another retailer to purchase the part that anyone could walk in and buy. For instance, if you went to Radio Shack or some other retailer to obtain a part then I would say no you shouldn't up charge the item above the retail price.

    For instance, if you were a plumber and you were working on a house and ran to the hardware store and paid full price for a part you needed to make a repair and paid full retail price for the item, then I would not charge a higher price. Although I could, I don't feel it would be right.

    Provided you have a supplier in place offering a wholesale price and it's a part you have to supply, then I see no reason why you should not charge a surcharge and provided it is a fair markup I would not disclose it.
     
  4. Fergal

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    Good point miles2152, your customer might be disappointed if they saw the item in their local store and realised that you charged them more for it. It would be good business practice to source your supplies from a trade supplier or wholesaler, whenever possible. You don't want to be spending your time purchasing parts, without getting a return for that time.
     

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