With improved quality and enhanced features, tech giants usually sell more and more products every year. But the year 2022 saw the lowest number of smartphones shipped since 2013.
Demand has softened due to inflation and economic crises, which means customers are sticking with their old mobile devices. Simultaneously, orders for replacing batteries, fixing water damage, and installing new screens have also increased.
This justifies why the cell phone repair market has demonstrated consistent numbers throughout the past 5 years.
A Numbers Game
No, we are not referring to the number of cell phones that your repair shop fixes every day. Profit and loss, operational costs, gross revenue, and net profit are just some of the elements that successful repair businesses monitor every now and then.
Repair businesses need to analyze growth patterns or create smart strategies to avoid losses. Whether it is about hiring skilled technicians or partnering with the right third-party suppliers, every move needs to be calculated.
Let’s start with the basics:
- In the US alone, the cell phone repair industry was worth $4 billion in 2022
- The average cost of starting a cell phone repair business is $19,267
- Weekly profit in the cell phone repair business is around $27,000
- Phone repair business can generate a revenue of $1.44M per year
Cost of Hiring Skilled Technicians
Cell phone repair technicians in the US are typically paid $16 per hour, and the salary ranges from $13 to $21.
Aside from creating a comprehensive job description and listing down the key responsibilities, your repair business will have to consider the costs associated with technicians.
Technicians are at the forefront of your repair business, and they have the keys to success. While looking for qualified technicians, advertise the job opening and notify existing employees about it. In some cases, offering referral bonuses might cut it.
That being said, the focus must be on the technician’s skill set, and whether they will be able to handle every kind of order that your repair shop receives.
Here’s What Repair Businesses Need to Know
- The cost of registering a repair business is $150 – $200
- The cost for licensing and permits is $100 – $300
- Insurance cost is between $100 – $300
- The cost of website creation and optimization is $1,000 – $3,000
- Repair tools cost between $500 and $1,000
- Repair training costs between $400 – 1,600
- Business cards and brochures cost between $200 – $300
Firstly, your repair business needs to measure leads generated through each individual marketing channel, and how much each lead costs per channel. RepairDesk’s lead generation report efficiently compiles all the information you need to track progress.
Eliminate the hassle of manual record-keeping. With RepairDesk’s expense management module, you can keep a record of your repair business expenses based on categories, such as shop rent, spare parts, and marketing.
Inventory and Spare Parts
Next, you need to track inventory and analyze the cost of spare parts to manage stock levels and take better purchasing decisions. This allows your repair shop to order items in stock and identify discrepancies in expected versus actual stock levels. With a stock report, you can identify items that are low in stock and need to be ordered.
With our InjuredGadgets integration, you can view inventory levels in real-time and prevent running out of stock.
Accounts Payable and Receivable
RepairDesk allows you to manage payments and keep records of how much your customers owe your repair shop through accounts receivable reports. In case your repair shop requires a special part for the job, charge a deposit from the customer.
Another important aspect to monitor is the number of customers requesting each type of repair and also how many of those repair orders have been completed.
While you are on it, determine your repair shop’s profit margin by recording the difference between the cost of goods sold (COGS) and the sales price. In the case of repair shops, COGS is the cost associated with repairing a cell phone.
How can any business miss out on their sales numbers? It’s imperative to track which services sell the best and also keep an eye on profit margins. You can also get a comprehensive view of your repair shop’s progress under RepairDesk’s KPI dashboard.
Performance and Efficiency of Technicians
Using RepairDesk’s employee productivity report, you can track the number of repairs each technician completes and the average time for each task. Moreover, you can determine employee efficiency by calculating the ratio of productive hours to total working hours.
Creating a separate record of repairs that are completed successfully on the first attempt allows you to identify each technician’s skills.
Crunching these numbers allows your business to stay on the right track toward success.