Margin, markup, price...what do you think about this sale??

John Prophet · October 3rd, 2002, 06:50 PM

Sold a computer the other day:

HP "Pavilion" Celeron 766Mhz, refurb (compgeeks)
30g HD
128M Ram
4x burner
Hotkey keyboard
W98SE (with COA and book)

Star Office
E-sword Bible software
Several free games and/or demos.

The comp is "refurb" (looks brand new to me though)...the rest of the setup is brand new.

Envision EN-710 17" monitor

Epson c40s printer (silver grey to match comp)

Leather high-back managers chair

Kingston Personal Computer Workstation (nice sturdy desk with pull out keyboard drawer, monitor and printer shelves)

I sold it all for $775 and I think (guessing high if anything) I had around $500 invested.

So thats $275 profit on a $500 investment. So I suppose thats a "markup of 1.55 or 155%.

Is that pretty decent or is it too high or too low.

Obviously the trick is buying it as cheaply as possible so you can charge a decent price but still make some profit.

In this case, I made a few bucks and dude got a good deal... Seems he got a lot of value for his money.

What do you think about the price, margin etc. If I invested 10-15 hrs in this little project, it paid off pretty well then correct?

Any feedback is appreciated, thanks, JP

Thud · October 3rd, 2002, 06:57 PM

Let's see...at 15hrs, you would have made about $18/hr on the deal. In my book, that's not chump change. You gave him a load of stuff for his money. If he was happy with what he got, then yeah, I'd say it was a great deal for all parties involved.

Mntsnow · October 3rd, 2002, 07:35 PM

Thud has pretty much answered it in my eyes...You did well and the buyer did well. both parties happy? If so you and they did fine

**Martoch** · October 3rd, 2002, 07:42 PM

Well JP, I'd say he took you to the cleaners!

J/K of course...

To me the knowledge involved in setting up the system/components/OS/software/etc is worth it's weight in gold to a customer. Sure everyone can order parts cheap online, but not as many people as you might think can piece all of the parts together. He didn't have to research any parts for compatibility, spend any time reading through instructions, or have to fumble through software installs (fdisk--what's fdisk?!

).

He got a nice system with major perks--new leather manager's chair & personal workstation--even I'm jealous now, I've seen those chairs and that desk sure sounds a bit better than my $45 WalMart special!

So of course he's satisfied.

You put around $500 into a project and got around $275 profit from it. As Thud mentioned you made anywhere from $18-$27/hour (sweet!) and I'm sure you didn't exactly hate doing it right? I would love to be able to earn 150%+ profit on a computer project that I actually enjoyed doing.

I look at it this way...I have around 40 or so people in my work center and at least half of them have asked me for computer tech support at one time or another. The MOST valuable thing that I'm losing is my time...can't put a price on that.

So did you charge him to much? No
Did you earn your money? Yes
Did he get a fair deal? Why certainly
Are you both happy? Let's count the smiles:

Yep!

You should feel quite good about that transaction...

My $.02

Mike

John Prophet · October 3rd, 2002, 07:53 PM

Kool beans. Now maybe I can offlaod this P2 350 for around 300 having paid 140 plus 10 for modem! LOL.

Richard Cranium · October 3rd, 2002, 08:00 PM

Looks right on target to me, on the PII 350's I try to get about $300 also, it's hard though with Dell breaking trade laws [IMHO] by selling units below cost.

Does anyone remember all the whining and blubbering when Japan dumped a bunch of minivans on the US market below cost ?

ironforge · October 3rd, 2002, 11:35 PM

at work we just bought 70 count of dell PC's.. older models

P2-450, 256mb ram, cd-rom, 10+GB hard drive, mouse/kb, etc etc for less than $150 shipped (for each of the 70)

no monitor or speakers but not that big of a problem

I get a lot of people asking me to do work on the side.. and as others put it... your time is very valuble..
I usually charge them 35 an hour for general work.. that is still cheaper than if you took it to a shop or etc..

John Prophet · October 4th, 2002, 12:04 AM

Where did you get those Dells from at that sweet price?? Hehe.

Well Ive said for a while now that if the average person took the time to look online a bit, they would rarely buy from B&M. Some peeps will always need B&M for assistance etc but I doubt they would pay $39.99 for Norton 2k2 virus when they could get it online for $7.99 nor would they pay $20! for a simple USB cable that cost about a dollar online. As usual, knowledge is power.

ironforge · October 22nd, 2002, 11:51 AM

We bought them from techsmart.com... we tested all 70 and every one booted up just fine.. we are using them to replace all the 166's & 200's floating around hehe..

We got a cheap price since we bought their whole stack... they had 70 on hand and we bought all of them.. of course we snuck in a few personal orders there

caddmannq · October 22nd, 2002, 02:11 PM

You sold him a Pavillion

for $775 US dollars

John, you took that guy to the cleaners when you unloaded that Pavillion. We've had a few of those around here and today you couldn't give me one of those dang things