Matt Ham is the president and owner of Computer Repair Doctor, a company with eight retail locations that repair electronics of all sorts, including computers and smartphones. Ham said, “If you have a device that’s broken or running slow, you can bring it in and we’ll take a look. We offer free quotes. Then, we repair and get you back up and running.”
Jumping Right In
In high school and through college, I had hardware and tech-related positions. I had always been in IT, fixing things. When I was living in New York, I was looking for a part-time job while I was in grad school. I blanket emailed my resume to a bunch of places and got hooked up with this company that does exactly what we do today. Actually, now we manage their locations for them. That was my first introduction into this industry. I was there for a few years and I quickly started running their company. I tripled and quadrupled their revenue.
When my wife got into med school, we were moving to Tallahassee, Florida. By that time, I had learned that I enjoyed the small business environment and doing things for myself. Since I knew this industry, I thought I would give this a try, jump right in, and open my own repair shop.
Managing Business Finances
I was fortunate that I was able to save up some money when I was living in New York. I opened our first location with money I had. As we’ve opened more stores, we’ve gotten a new credit line for every store. We’re trying to pay all of them down – Some of them are at zero and others are at the upper end. We definitely use credit cards to help cash flow. And, in addition to that, we’ve gotten SBA loans. When we opened our stores in Raleigh, North Carolina, and Orlando, Florida, we went through an SBA banker. That was a good option for us – We got a low interest rate and very favorable repayment terms over 10 years. The only downside of that has been that I had to give a personal guarantee, which adds risk in the long run.
One of the other ways that we’ve gotten money is that some of the locations we’ve opened more recently are partially owned by different people. We took over two existing stores, and I own 50 percent of those. Another one, we had an investor put up 50 percent. As far as the parent Computer Repair Doctor, I still retain 100 percent ownership of that.
Our approach to managing cash flow is the more positive, the better. We try to track cash flow on an individual store basis and then add in the corporate overhead that it takes to run all of our stores. We look at the incoming sales for each particular store compared to the expenses. Corporate has its own expenses, like my salary and our COO’s salary. The whole idea is that once we’ve added the corporate overhead on top of the stores’ profits, we’ll have a company profit left over.
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On a day-to-day basis, the goal is to get as many customers in the door as we can to maintain that positive cash flow. In our industry, the biggest things are the cost of parts and the cost of staff on top of the normal things like rent and utilities. We can scale up and down really well because, if we don’t have that many jobs coming in, we don’t spend that much on parts. Usually, it’s stable enough that we can staff a certain amount of people at a store. If it starts getting busier, we can staff additional people.
We have one main supplier that we get all of our phone and tablet parts from. We have seven-day terms with them. They are based in China and we buy direct. Other parts in this industry just get purchased upfront from eBay or Amazon because that’s how most U.S. sellers work. For those, we just use credit cards that have cash-back rewards.
Business Challenges and Rewards
I would say maintaining positive cash flow is the most difficult thing about running the company. That’s the bottom line. Every challenge that I’ve faced affects that.
One of the things I didn’t realize when I started the company was how much marketing plays into this industry. We’re not a specialty service. There’s a lot of competition in this market, so we have to differentiate ourselves. That’s always an uphill battle that you’re never going to win, but you always have to stay on top of.
The most rewarding thing is having the flexibility to work from anywhere and make my own schedule. I’m my own boss and I like that aspect of running my own company. Other rewards are positive reviews from customers or positive words from our staff about how they like working with us and for us. We try to foster an environment that is not only positive for customers, but positive for staff. And, there’s no more rewarding feeling than looking at the numbers at the end of the day and seeing that we charged a lot of money across the board! That’s a great feeling, especially when you’re constantly fighting for every piece of market share.
Business Lessons Learned
We’ve definitely had our share of learning. There are lots of things that we know better now. Some of the location choices that we made in the past weren’t great. For example, in Orlando we chose a location that wasn’t the best and we’ve relocated the store, which seems to have made a positive effect. We chose a location that was on two very busy roads. When we saw the vehicles per day count on those, we thought it would be great because tons of cars were coming by. But, we were in the corner and kind of hidden unless people were immediately in front of us. And the road we were on was more like a thoroughfare where people were driving by every day but not necessarily stopping to shop. We learned that it’s important to look at the amount of people driving by every day, but if you don’t have visibility and people aren’t actually stopping at that retail center, you’re just going to be seeing your customers pass by every day.
I think I had learned a lot from running the other company when I lived in New York, so I did a lot of things right when we set up this business. For example, the choice of our company name, Computer Repair Doctor, is descriptive, broad, and a good play on the doctor motif. At first, I was considering a name with “Tallahassee” in it, because that was where our first store was. But, now we’re opening our ninth location, and I’m glad I picked something that could be used nationwide.
Also, from the beginning, we focused on our Google rank and set up our website and online presence to target our customers.
Advice for New Entrepreneurs
Focus on the cash flow. The No. 1 reason companies go out of business is because of negative cash flow. It’s a lot easier than you’d think for an owner to forget about cash flow because they focus on long-term goals. They forget about the day-to-day. If I run out of money tomorrow, it doesn’t matter how well I’m setting myself up for success in the future, the game ends early.
What’s Next for Computer Repair Doctor
We’re moving into franchises right now. We have a store manager who’s going to be opening our first franchised store later this year. I think it’s a little early for our company to be dipping into franchising, but there’s a demand there from some of our employees. Hopefully, we’ll be adding a bunch more stores and helping aspiring entrepreneurs open up their own Computer Repair Doctor.