How To Start A Cell Phone Repair Business (The Beginners Guide)

Filed in Business by on May 5, 2020 0 Comments

This is indeed a great business idea that will bring daily income to you in thousands if you are an expert in what you are doing.

Before you make plans in starting such business, you need to undergo training that will help you to learn the different skills used in repairing cell phones.

Getting customers for your business will be very easy if you know the basic communication skills and cell phone repairing techniques.

How To Start A Cell Phone Repair Business

How To Start A Cell Phone Repair Business

1. Plan Your Business

A clear plan is essential for success as an entrepreneur. It will help you map out the specifics of your business and discover some unknowns. A few important topics to consider are:

  • What are the startup and ongoing costs?
  • Who is your target market?
  • How long it will take you to break even?
  • What will you name your business?

Luckily we have done a lot of this research for you.

What Are The Costs Involved In Opening A Cell Phone Repair Business?

Depending on the location of your shop, most of the costs involved in the startup will be rent and utilities. Some cell phone repair shops operate as kiosks in a mall or other heavily trafficked consumer centers. These can be more cost-effective, but may not have the storage area needed for your business, as it expands and grows.

Some businesses operate out of a home and reduce much of the overhead associated with a brick and mortar location. There will be some loss of walk-in customer business, but most customers will find your business online through a website or webpage via social media.

There are a few options and configurations for how you will set up your business, so consider them carefully and think about what will work best, both currently and for the future.

What Are The Ongoing Expenses For A Cell Phone Repair Business?

Other than rent and utilities, if you have a brick and mortar, most costs will be generated from buying parts and supplies for the actual repairs. And you should be able to recoup these costs, once the repairs are completed. As you grow as a business, you may find additional costs pertaining to advertising or hiring additional staff, but this business tends to have a relatively low overhead.

Who Is The Target Market?

Your target market is technology consumers. To be specific, you’re gunning for the savvy tech user, who understands how a repair can save them time and money. Especially as cell phones and other devices become more expensive and more powerful, the owners will want to stay with their tried and trusted choices for tech connectivity.

Another smaller, yet growing, the target market is the environmentally-conscious tech consumer. As more people become aware of the growing problem of added tech waste to our landfills, there are more and more consumers who wish to keep a device as long as possible, with repairs and upgrades keeping their device working and out of a dump pile. Appeal to both of these aesthetics to increase your overall business bottom line.

How Does A Cell Phone Repair Business Make Money?

Revenue is generated through the fees customers pay to have their cell phone or other mobile device repaired or upgraded.

How Much Can You Charge Customers?

Repair and upgrade prices will vary, depending on the make and model of the device. An average cost for a broken screen, for instance, can start around $75 but can climb to as much as $300.

As stated before, make sure your prices are competitive, but remember that a repair on a $1000 phone will still be much more affordable than replacing the phone altogether.

How Much Profit Can A Cell Phone Repair Business Make?

An average cell phone repair business could net profits in the range of $50-65,000, with greater earning potential, as you continue to become more well-known and successful.

How Can You Make Your Business More Profitable?

Many cell phone repair businesses expand to include repairs on all kinds of tech gadgets. Gaming systems and music production equipment may also be good fits for your repair business.

You can also offer customers phone and data plans through third-party service providers. As the technology surrounding our lives increases, as it is sure to, there will be more avenues to explore and include in your business plan.

What Will You Name Your Business?

Choosing the right name for your business is very important. That alone needs thorough planning because you need to relax your mind before you can get the right name for your business.

2. Form A Legal Entity

Establishing a legal business entity such as an LLC prevents you from being personally liable if your cell phone repair business is sued. There are many business structures to choose from including Corporations, LLCs, and DBAs.

You should also consider using a registered agent service to help protect your privacy and stay compliant.

3. Register For Taxes

You will need to register for a variety of state and federal taxes before you can open for business. In order to register for taxes, you will need to apply for an EIN. It’s really easy and free!

4. Open A Business Bank Account & Credit Card

Using dedicated business banking and credit accounts is essential for personal asset protection.

When your personal and business accounts are mixed, your personal assets (your home, car, and other valuables) are at risk in the event your business is sued. In business law, this is referred to as piercing your corporate veil.

Open A Business Bank Account
  • This separates your personal assets from your company’s assets, which is necessary for personal asset protection.
  • It also makes accounting and tax filing easier.
Get A Business Credit Card
  • This helps you separate personal and business expenses by putting your business’ expenses all in one place.
  • It also builds your company’s credit history, which can be useful to raise money and investment later on.

5. Set Up Business Accounting

Recording your various expenses and sources of income is critical to understanding the financial performance of your business. Keeping accurate and detailed accounts also greatly simplifies your annual tax filing.

6. Obtain Necessary Permits And Licenses

Failure to acquire necessary permits and licenses can result in hefty fines, or even cause your business to be shut down.

State & Local Business Licensing Requirements

Certain state permits and licenses may be needed to operate a cell phone repair business. Learn more about licensing requirements in your state by visiting SBA’s reference to state licenses and permits.

RECOMMENDED: How To Start An Airport Shuttle Business (The Beginners Guide)

For information about local licenses and permits:

A cell phone repair business is generally run out of your home or a storefront. Businesses operating out of a physical location typically require a Certificate of Occupancy (CO).  A CO confirms that all building codes, zoning laws and government regulations have been met.

If You Plan To Lease A Location:
  • It is generally the landlord’s responsibility to obtain a CO.
  • Before leasing, confirm that your landlord has or can obtain a valid CO that is applicable to a cell phone repair business.
  • After a major renovation, a new CO often needs to be issued. If your place of business will be renovated before opening,  it is recommended to include language in your lease agreement stating that lease payments will not commence until a valid CO is issued.
If You Plan To Purchase Or Build A Location:
  • You will be responsible for obtaining a valid CO from a local government authority.
  • Review all building codes and zoning requirements for your business’ location to ensure your cell phone repair business will be in compliance and able to obtain a CO.

7. Get Business Insurance

Insurance is highly recommended for all business owners. If you hire employees, worker’s compensation insurance may be a legal requirement in your state.

8. Define Your Brand

Your brand is what your company stands for, as well as how your business is perceived by the public. A strong brand will help your business stand out from competitors.

How To Promote & Market A Cell Phone Repair Business

Your biggest concern for success will be making sure customers are aware of your business and the services you can offer. Therefore, advertising and marketing are critical pieces to this puzzle.

And, in order to keep costs low, you should consider all of the inexpensive, yet effective methods for getting your name known among consumers.

To start, business cards, flyers, and brochures or handouts explaining your prices and areas of expertise are still effective, especially if you’re able to leave them in places where customers will see them and pick them up.

Some non-competitive tech stores will let you leave your information on their counters or in storefront windows. You can also hand out cards and flyers during social gatherings in your city or region. You’d be surprised how many people will refer to the tangible items they casually receive.

Next, look to set up a website or start a social media page on Facebook or Instagram. Many customers will do a Google search first when looking for a cell phone repair shop.

You want to be their top result, so use keywords to push your business to the top of these searches. You may also be able to join social clubs, groups, or organizations, specifically related to technology and even device repairing and modifications.

Finally, make sure that you make a connection with your customers. Word of mouth referrals and positive reviews are great marketing tools.

When a friend refers to another friend, they’re often going to follow up on the recommendation, as it’s coming from a trusted source. Remember, the main goal is to become known and trusted and then continually live up to your positive reputation.

How To Keep Customers Coming Back

As mentioned previously, customer reviews and referrals can be some of the most important aspects of a healthy business. Develop business relationships with your customers. Don’t over-promise what you can’t deliver.

And don’t make your prices too low, simply to attract customers. You have to be competitive, but you should also be comparable to your competition. You can offer specials now and then, especially for repeat customers.

And you may want to offer plans for future service visits. These incentives will help customers think of you first when deciding on a repair business.

9. Establish Your Web Presence

A business website allows customers to learn more about your company and the products or services you offer. You can also use social media to attract new clients or customers.

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