How important is it to diversify your offerings?

Industry community Tech For Techs asks its members what new areas they have branched out into and why diversifying their offerings have helped them generate more business.

CORMIE CORMISON, CROSSHAVEN COMPUTERS

“Moving as many business customers as I can to MSP. With me fitting more and more SDDs, I’m less likely to see home customers as often. They only come when their computers are slow, which are usually due to windows update issues. Yes, we are living in a golden time of SSD upgrades, but we must realise that it might reduce our future work.”

RICH FORTH, PHASE 4 COMPUTERS

“We’ve seen the changes in the industry, so like many others, we’ve been moving business customers onto managed services, as well as improving our offerings. Along with PC repair we do phones, tablets and consoles repairs, CCTV, ink refilling (and compatibles), and Wi-Fi hotspot management for hotels. As well as looking at the possibility of selling stationary (we’ve been asked if we can keep pens and notebooks, I don’t mean styluses or laptops!).”

PETER WHITEHOUSE, SCANSTATION COMPUTERS LIMITED

“We are doubling down on services both with consumers and businesses. Being a local trusted adviser to your clients is something that large etailors cannot complete with. Providing a “solution” delivers immense value to the end customer and can enhance your relationship as well as generating monthly recurring revenue opportunities.”

MICHAEL JAMES DEAN, COLLIEDOG COMPUTERS

“It is extremely important. You have to move with the times and figure out, quickly, what is not worth doing anymore and what is worth learning and focusing on in the future. I’m pushing into digital signage now as there is a real demand for it and there are some nice hardware and software solutions out there that meet all sorts of requirements.”

STEVE MOORHOUSE, ALBANY HOSTING

“I’m going to concentrate on getting our hosting business out there. We have been creating websites and hosting since 1996, but it’s mainly been for our existing customers. We look after over 200 domains and about 150 websites. It would be nice to have more residual income. I was thinking about doing an offer on JVZoo (joint venture website) and offering something like purchase one year and get two years free. I know we will get a hit on year two and three but year four should be good.”

NIGEL PERRY, CADISHEAD COMPUTERS

“We have been pushing more and more onto SSD drives and managed antivirus. I personally think that the residential side of our business is seriously declining. With more clients having smartphones and tablets, and with everything stored in the cloud, there are less laptops being repaired. When you consider the cost of a cheap machine for £180, why would they want to pay literally half the cost again for a simple screen replacement? I haven’t seen a desktop for literally four months. I can count on one finger the amount of new PCs I’ve built this year.”

IAN ROBERTSON, M21 TECHNOLOGY SERVICES

“I want to go into the creative media and website side of things. I am qualified in this and have got experience doing the job part time in college but I am still rusty and need to learn more over the summer before launching it. My biggest issue with this though as how to carve out a niche, I am not sure what I can do that other companies are not doing. The repair side of things is just dead and I taking on jobs despite my better judgement because of it. Part of me thinks I might just apply for full time jobs though and have done with it but it is a huge step.”

PHILIP GRIFFITHS AND JENNI GRIFFITHS, OWNERS AND FOUNDERS OF TECH FOR TECHS

“There are many thing techs can diversify into, and it can help minimise financial risks in the long term. But before you diversify, you have to make sure your current offerings are the best they can be, and if you spend more time promoting new products and services they may negatively affect the part of the business that you are known for. Some of the things that small, independent IT business can do is find ways of expanding on what you do rather than adding something completely different. For example, if you are a standard repair shop that just repairs computers all day long, you could venture down a few different routes, from stocking items people may need, like paper and ink (shrinking market), to even new and refurbished computers.

Whatever you diversify into, make sure it’s something that will get people coming back for more or gives you some form on ongoing revenue. Security products are always good, people will always need more, but the problem is they may renew it online when they get a renewal popup so you could lose out, unless you sell a product like BullGuard, that has a revenue service, so if someone renews the product online after initially buying it from you, you will then get a 25% cut of the sale for the life of the product.

Other recurring services for small business to get into is maintenance contracts. You can easily add MSP services and features into a repair business, and taking monthly payments is easer than ever with websites like GoCardless. Offering these services will not only give you a monthly income – which is ideal for quiet times of the year – but it also turns you into a proactive company rather than reactive, allowing you to find issues before they get worse or in some cases stop issues before they even happen.

Focusing your business on one product or service type can also be a benefit, as your company will become experts at that topic and people will come for miles because they know you are the best of the best. But focusing has downsides as well, new product types and services are coming out all the time and replacing the older ones. Just look at computers, 20 years ago nearly everyone got online using a desktop computer. 10 years later, that changed to laptops, and five years after that, smartphones and tablets have become the most popular items for surfing the internet. The jury is still out on this debate and there are pros and cons to both focusing and diversifying.”

Like this content? Sign up for the free PCR Daily Digest email service to get the latest tech news straight to your inbox. You can also follow PCR on Twitter and Facebook.

Read the latest edition of PCR’s monthly magazine below: