Are you interested in starting a cell phone company online? If YES, here is a complete guide to starting a cell phone retail & repair business from home with NO money and no experience.
Okay, so we have provided you an in-depth sample cell phone repair business plan template. We also took it further by analyzing and drafting a sample cell phone marketing plan backed up by actionable guerrilla marketing ideas for cell phone sales & repair companies. In this article, we will be considering all the requirements for starting a cell phone retail & repair business from home. So put on your entrepreneurial hat and let’s proceed.
Why Start a Cell Phone Company?
As at 2008, according to Sign-on San Diego, there were 250 million mobile phone subscriptions in the United States. From then till now, more people have gotten cell phones, which mean that the market has consistently grown and become more relevant as regards more uses and applications. This is a lucrative business that offers you the opportunity to be at the forefront of new and emerging technologies, if you intend to go into this kind of business as an entrepreneur.
What Does It Take to Start a Cell Phone Retail & Repair Business Successfully?
First it would be wise to ensure that you get a suitable location. Most cell phone businesses are in close proximity to either a food court in a shopping mall or a gaming supply store. Your location would need to be one that has a steady amount of food traffic, which means that it must be easily accessible and convenient to customers and those that window shop.
Most cell phone businesses in the United States prefer to lease kiosk spaces especially as this tends to provide high traffic but at a lower cost than those offered by a traditional retail space. Most commercial leases especially for retail space usually are triple net, which means that you not only pay lease price per square foot, but would pay property taxes and maintenance as well.
The next thing to do will be to establish accounts with vendors for the inventory of your business. You would need to decide if you are going to offer cell phones that are supported by just one carrier; this would need you carrying a thorough research by carrying out direct inquires with your carrier of choice, also asking them about franchising opportunities.
If you however decide to use several carriers, this would mean you carrying out more research. Another way at keeping yourself more knowledgeable as regards industry trends is in attending trade shows or checking industry publications.
Starting a Cell Phone Retail & Repair Business from Home – A Complete Guide
- Cell phone Industry Overview
In recent years, there has been a change in the dynamics and structure of cell phones globally which also includes smart phones. This is due to the fact that there has been a positive change in the design and functionalities of cell phones which has led to an increased cost.
The improved functionalities such as emergence of new network technologies such as 4G to enhance mobile browsing, and also improved upgrade of operating systems, have led to the growth of the industry, and expansion into several markets that were deemed impossible.
- Interesting Statistics About the Cell Phone Industry
The cell phone business has an unstoppable growth that makes it have the strongest growth industries as well as being responsible for its huge revenues in the market. Due to research and forecasts, 65% of children between the ages of 10 – 15 have been projected to own cell phones between 2014 and 2016.
Apart from children, even those who live below the poverty line have been projected to own a cell phone as it is now regarded as one of the essential commodities for everyone in the society.
According to research, the cell phone industry had a growth momentum between 2006 and 2011 and is expected to reach an estimated $334.8 billion in 2017 with cumulative annual growth revenue of 6.8% from 2012 to 2017. Regions that are still developing are expected to register significant growth in this industry due to an increase in population as well as rising urbanization.
The cell phone industry comprises of establishments whose primary focus is in the manufacturing of mobiles. This means that the industry expands to include not only the end salesman but also the phone set manufacturers.
The market has less entry barriers which is majorly to reduce the threats that will be posed by new players. This means that the older players are always evolving as regards technologies and innovations which practically make it difficult for new players to keep up with, thereby still allowing the old players to retain part of its customer base while still growing in revenue. This does not mean though that this strategy has been effective for all such cell phone companies.
Starting a Cell Phone Sales & Repair Business – Market Feasibility and Research
- Demographics and Psychographics
The demographic and psychographic composition of those that use cell phones include professionals, students, the general public, children in age groups of between 10 and 17, as well as service organizations and other companies that need to be in touch with their employees and clients.
Most of the people who use a phone are usually those that are able to afford it, but since carriers usually have different packages that can accommodate any budget group, it therefore means that more people irrespective of class and age own a cell phone.
- List of Niche Ideas within the Cell phone Industry
There are clearly a lot of niches in the cell phone business industry, even though there are clearly services or areas of specializations that cannot be differentiated, due to its uniformity of services. The key to thriving in this kind of industry is in offering a specific niche that will enable your company stay in business irrespective of the size or scale of your business.
Some of the area of specialization that exists in a cell phone business includes;
- Sales of mobile hardware and accessories
- phone maintenance services and repairs
- mobile applications
- mobile money services
- Software and such other kinds of services.
If your business is a small one, you might not find it easy to offer many services and will have to stick to a few that you are quite skilled in, you should however be aware that larger cell phone companies will be to offer more services than your business would, especially those that have long been in existence.
The Level of Competition in the Cell phone Industry
Due to low entry barriers, competition in this industry is quite stiff and most businesses that haven’t been able to innovate or offer something completely new have failed. Which is why before going into this business it is better you carry out a thorough research that will ensure that the field you intend going into in your region, has less competition for you to battle with.
If however, you intend going into a popular but crowded field, then you would need to not only be proactive but offer what most of your competitors aren’t offering. This is not to say that in offering something unique will prevent the larger companies from offering it and staking a claim in your market share, but if you are proactive and good to your customers, you will still get to retain most of your customer base and revenue.
List Of Well – Known Brands in the Cell Phone Industry
This industry is one that has seen many new entrants die off or even the seemingly old ones completely displaced by either existing or new entrants, and so brand names in this industry, are ones that have stayed for a while and also one that most people are aware of. Some of the well-known brands in the cell phone business industry in the United States are:
- Apple Inc.
- LG Electronics
- HTC Corporation
- Samsung Electronics
- Huawei Technologies
- Google Inc.
Before venturing into the cell phone business as an entrepreneur, you would need to be sure that it is the business you intend doing. First you would need to carry out a thorough research into the industry, so as to determine which field you would be best at.
If you intend to start big, you would need to carry out an understudy of similar companies that have done well and how they do what they do to remain relevant. Apart from knowing what field you intend going into and planning for it, you would need to make plans on how you intend to attract customers from other businesses to your own.
Cell phones were once seen as a luxury item but now are seen as an essential commodity and even though there have been economic downturns, the industry has had just a slight dent unlike other industries that have gone down during economic downturns. It is important to note though that the market is seen as mature in the United States, and so you might need to ensure that your company will provide an added service that customers will be unable to resist.
Is the Cell Phone Business Worth Starting from Scratch or is Buying a Franchise Better?
Franchising comes with opportunities that a start-up might not have. For one, a franchise offers a brand that start-ups struggle for years to have. A good brand can easily make or mar a business that is just starting out. Also, when purchasing a franchise, you purchase a system that is already in place, and so would not have to worry about things like getting customers, or breaking into the market place. However, whilst a franchise might work in various industries, it is not so common in the technologically inclined industry of cell phones.
This therefore means that any franchise that might exist in this industry might not be worth it, and this would mean that you would need to start from the scratch for this business. Customers in the tech industry aren’t moved by the franchise brand names; rather they are moved by the kind of carriers your cell phone business carries, and its superiority in services as compared with other similar cell phone businesses. This means that not only would you need to start from the scratch, but will have to draw strategies at attracting and retaining customers.
Possible Threats and Challenges You Will Face When Starting a Cell phone Business
All businesses face challenges and threats from the start and throughout the life of their businesses. Facing the challenges of a business is totally expected for an entrepreneur, and the way you handle your challenge or threats from competitors will determine if you remain in business and thrive or fail.
Challenges might come from the economy, from declining customer base, or from your competitors, as an entrepreneur you will need to be constantly proactive so as to stay above your challenges and threats.
Starting a Cell Phone Retail & Repair Business – Legal Matter
- Best legal entity to use for this Cell phone Company
One of the most important decisions you get to make when starting your business is the legal structure you feel is best for your business. The legal structure you choose for your business determines so many things like how much you will pay in taxes, your personal liability, the amount of paperwork your business will be required to carry out, record-keeping, and your ability to finance your business; which is why it is mightily important that you seek out counsel from experts in your field about the best legal entity for your business.
There are majorly four types of legal entities in the United States of America. The sole proprietorship is one that is easy to form and which offers the owner complete managerial control; it however, leave the owner open to liabilities. A partnership usually involves two or more people that do not bear the tax burden of profits; the partners are however personally liable as regards the business.
A corporation is a separate entity from the owner of the business and can be taxed or held liable for its actions without the owner. The Limited Liability Company (LLC) is a hybrid of partnership and corporation, and is usually the most common legal entity used in the United States.
No matter how easy it might seem to start with any legal entity, you would need expert opinion on the pros and cons of each type of legal entity and which is best for your business. It is worthy to note that you can always change your entity as your business grows.
Catchy Business Name ideas Suitable for a Cell phone Company
- The right repairs phone business
- Mobility phone hardware store
- Phyl phone accessories
- The right gadget store
- Ben’s phone place
- Quick phone repair store
- Keypads and accessories ventures
The Best Insurance Needed for a Cell phone Company
As one who intends starting a business, it is always advisable that you seek out insurance for your business. An insurance cover protects you and your business from any sort of problems – both known and unforeseen – that you might encounter in the course of carrying out your business. If you do not know or aren’t sure of the best insurance that is good for your business, you can always talk to an insurance agent or broker who will guide you on what is best for you and your business.
Some of the basic insurance covers that you should consider purchasing if you intend starting your own cell phone business in the United States of America;
- General Insurance
- Health Insurance
- Errors and Omission Insurance
- Workers Compensation
- Liability Insurance
- Gadget Insurance
Does a Cell Phone Sales & Repair Business Need Intellectual Property Protection?
Depending on the field you intend to go into in this industry, especially if you are going into pure sales of hardware and accessories, you probably might not need intellectual property protection. Some people might like to secure an intellectual property protection for their logo or brand name but most do not consider it a priority.
However, if you would be going into software, and other such kind of business, then you might need an intellectual property protection for your business, and would need to seek the services of an attorney in such field to guide you through.
Does a Cell Phone Business Need Professional Certification?
If you intend starting a cell phone business, it would not be required of you to own a professional certification especially if you intend going into sales or hardware and its accessories.
However, some degree of certification might be required if you intend going into repairs of hardware, installations of mobile infrastructure, and software and operating system upgrades. The certification gives the customer the needed confidence in entrusting their devices to you.
List of Legal Documents You Need to Run a Cell phone Company
Below are some of the legal documents that would be required for you to successfully run your cell phone business in the United States of America;
- Certificate of Incorporation
- Business License
- Business Plan
- Offer Letters
- Operating Agreement
- Insurance Policy
- Contract Document
- Non Disclosure Agreement
Writing a Business Plan for Your Cell Phone Sales & Repair Company
Every business regardless of the type requires a business plan. This is the first thing that is required form an entrepreneur who approaches an investor or bank about their business idea. It is the document that shows if the business venture should be taken seriously or not.
As an entrepreneur that is serious about making money from your business, a business plan helps you see clearly where money can be made and which strategies employed can be effected. This doesn’t mean though that the business plan has to be very comprehensive and huge, any draft that clearly outlines the plans and strategies of your business idea is regarded as a business plan.
A business plan is a serious outline that acts as a guide on how you intend to successfully run your business. It is a document that will influence all your business actions and decisions, and so ought to be taken seriously. Most people usually turn their business plan into a work of fiction, but remember that if you pad your business plan and give fictitious figures and strategies, it only affects you and your business in the long run.
The whole idea of writing a business plan is not to put a dampener or hamper your entrepreneurial creativity or passion. A business plan should be seen as an illuminating part of the business building process, especially as research could lead to more findings that would be beneficial to your business in the long run. Another reason why you would need a business plan is that it provides a roadmap that can be followed. There are some key components that your business plan – comprehensive or draft- should have.
Your business plan needs an executive summary which summarizes the whole plan so that any investor can know what you are up to at a glance. Also, you would need to describe the business by including its history, structure, mission statement and strategies. You would also need to include the product and service you intend to provide plus any new innovations or technologies that are likely to set you apart from your competitors.
Your plan should also include a SWOT analysis, and also address market segments and indicate profitability of each area. You would also need to name your major competitors and also analyze why they have remained strong as well as their weak points and how you intend to exploit that whilst gaining a fair share of the market.
Lastly, financials should not be missing from your business plan. This would include projections of your profit and loss as well as cash flow. You would also need to carry out a sensitivity analysis, and a forecast of your balance sheet.
Many entrepreneurs are usually intimidated by the thought of writing a business plan and if you are such a person, you should consider getting the services of business plan writers to help you in drafting a business plan, but if that might mean you spending money that you don’t have, you could consider going online and downloading a cell phone business plan template, which will aid you in writing your business plan without stress.
Detailed Cost Analysis for Starting a Cell Phone Repair Business
If you are serious about starting a cell phone business then you should know that this isn’t a business you can start from home in the comfort of your sitting room, except you are into the delivery field. You would for this kind of business require either a traditional brick and mortar business or a kiosk.
However this doesn’t mean that you have to break the bank if you want to start this kind of business. If you rent a kiosk in a high traffic area, the business the location would bring would help offset the overhead cost of your cell phone business.
If you want to start off a cell phone business in the United States of America, you would basically need to check most of the items listed below;
- Business incorporation fees would cost $1,500
- Budget for insurance, business license and permits would cost $2,500
- Office space or kiosk rental for at least a year would cost $40,000
- Cost of equipping the store would cost at least $2,000
- Cost of acquiring phones for sales would cost at least $50,000
- The cost of an official website would cost $300
- Additional expenditure (signage, business cards, and adverts) would cost $3,000
Going by the report from the above listed items, an entrepreneur starting out a cell phone business on a small scale in the United States of America would need at least $100,000
For an entrepreneur that is looking to start a cell phone business on a medium scale in the United States of America, you would need not less than $200,000. If your intention is to start a large scale cell phone business in the United States of America, then you would need to raise well over $400,000.
Financing Your Cell phone Company Business
Except you already have a huge amount of money somewhere to throw into any business venture you might have, it is a must for you as an entrepreneur to source for funds for your business idea no matter how fabulous you think the business idea is. Finance for a business is one of the top priorities, as it determines whether a business starts, fails or succeeds. Most entrepreneurs do not relish the thought of seeking for finances but it is a task that must be done.
For those that intend to source for capital for their businesses, the first step before approaching any investor – formal or informal – is to have a business plan in place. A business plans tells whoever you intend to approach of how serious the intentions of starting off your business are. If you have a good business plan in place, a serious investor skimming through, will see all your strategies and either make an input or give you the finance you seek depending on the agreement you would both have to come to.
There are several options available to your cell phone business when it comes to financing your start-up business. Some of the options are:
- Seeking for micro loans from the Small Business Association (SBA)
- Applying for loan from the bank
- Approaching private investors
- Getting a soft loan from family and friends
- Raising money from personal savings as well as personal stocks
Choosing a Suitable Location for Cell Phone Sales & Repair Company
When starting your business, it is important to note that where you intend to locate the business might make or mar the business. If you own a cell phone retail business for instance, it would be disastrous for your business if you cite the business in an area without much traffic, like in a suburb, you would rarely have people patronizing your business.
Every business has certain features that determine where the business can be properly located. For instance, a cell phone retail business requires that it’d be located in a place that has a high amount of traffic like a mall, or gaming house. Different classes of people visit the mall, and while you might likely have more competition in the mall, your unique business positioning as well as how attractive you make your cell phone business, will determine how many people will visit your store.
If you decide to own a cell phone carrier company or manufacturing business, you would need to locate your company where the cell tower can receive and transmit data. This means that while you might not locate your business in the suburbs, you might not likely locate it in the mall or gaming center too. You might need to locate your business on the outskirts of town.
The key thing the location of any business must have regardless of what kind it is the convenience to customers as well as easy access to employees.
Starting a Cell Phone Sales & Repair Business – Technical & Manpower Details
If you are operating a cell phone retail business, then you really do not need equipment in carrying out your business. However, most of what will be used in your cell phone business can be purchased second hand except for the phones themselves. If you are trying to be economical, then there are really some places where you might get a discount on some of the equipment or at fairly used.
Some of what is needed to run a cell phone retail business include:
- Display racks
- Cash register
- Credit card terminal
Most people starting this business tend to start it in kiosks in popular places, and so you can start off this way as well. Only after you have made a name for yourself, can you then go into leasing a traditional brick and mortar building for your cell phone business.
The number of people that you would be regarded to employ will vary depending on the scale of your business, you can effectively run the business at start, but as you progress, you would definitely need more people to help in handling the business. If you are looking to build a structure for your cell phone business, you would need to employ a manager, front desk person, and sales men. This is about 4 to 6 people especially if you intend starting off on a medium scale.
The Production or Service Process in Cell phone Company Business
If you are going to engage in the cell phone retailing business where you will probably deal in hardware and accessories, then there is no production process involved.
The processes involved in the cell phone retailing business is in selling of hardware, accessories, and carrying out any repair that might be required by the customer. Other processes are learning about different operating systems and how best they can help your customer the end users. Also knowing about apps that work well with the cell phones you sell.
Starting a Cell Phone Sales & Repair Business – The Marketing Plan
- Marketing ideas and strategies for a cell phone business
Regardless of whatever business you intend starting, marketing cannot be divorced from it as it is what ensures that your business keeps afloat through the customers that will patronize your business mainly due to your marketing strategies. Which is why the business plan is important as you get to write out your strategies before the business kicks off, only amending as at when necessary during business operations.
Whilst carrying out your marketing strategies, efforts should be made on leveraging on all available sources so as to ensure your business makes the revenue that is required. Unique marketing strategies will get your business noticed faster.
Below are some of the strategies that can be used to promote your business and bring customers for you:
- Ensure that you give your kiosk or phone booth a unique look or signage that will be easily recognizable by your customers.
- Print handbills and fliers and have it shared around your target area.
- Create a website for your business and load it with unique content that will bring in traffic.
- Seize the opportunity offered by the internet by advertising on forum and blogs.
- Leverage on the social media by ensuring you register your presence on social platforms like Twitter, Linkedin, Facebook, Google plus and other such platforms.
- Offer incentives to those that refer your business by helping them upgrade their operating system for free.
- Keep abreast of happenings in the cell phone industry, so as to know what product might give you a marketing boost.
Factors That Will Help You Get the Right Product Pricing for your Cell phone Company
Before deciding on the factor s that would help you get the right pricing, you would need to know and understand your target market. Your target market will determine the kinds of phones you will stock to sell. If you are targeting the young and upwardly mobile crowd, then you might need to go for phones that aren’t too high end so as to be able to cater to most of your customers especially if you are located in a mall.
Possible Competitive Strategies for Winning Your Competitors in the Cell Phone Industry
All businesses except for those ones that are engaged in a non for profit kind all have competition. Which is why as a serious entrepreneur, you would always need to remain proactive by always churning out strategies that will ensure you remain top of your game, which means that your business must be unique enough to differentiate you from your customers.
In making your business unique, you would need to adopt unique strategies such as having some days that you give out discounts. Offering freebies via social media, and sponsoring shows that would recognize your business.
You could also offer services that your competitors aren’t offering so as to have an edge over them.
Possible Ways to Increase Customer Retention for your Cell phone Company
Customers love the business that pays attention to their every need. They also love a business that keeps and stays in touch with them, especially as larger companies due to the huge amount of customers they have rarely keep in touch, thereby losing some customers, which is why you as a competitor can choose to increase your customer retention by staying in touch before, during and after sales.
Apart from keeping in touch with customers, you would need to offer them value for money so that they could keep coming back. This means offering them excellent services so that they have no choice but to come back.
Strategies to Boost your Brand Awareness and Create a Corporate identity for your Cell phone Company
Every business love to get to that spot where their brand is recognized by everyone, but to be able to get to that spot, you will need to constantly boost your brand awareness and create a corporate identity for your cell phone business. Below are some of the platforms you can use to boost the brand of your company and advertise it as well:
- Constantly give out tips on your social media platforms
- Allow customers know what new products are always available and how easy they can get it.
- Give freebies on certain days so that people can learn to associate such days with your company.
- Advertise your business in online and offline directories
- Advertise your business via the media, local newspapers, radios and televisions.
- Participate in school award shows as a way of promoting your business.
- Network with similar businesses in your field, so as to gain knowledge and be known as well.
Creating a Suppliers/Distribution Network for your Cell Phone Company
If you run a cell phone retail business, then you probably will need t work with one or certain carriers who will be your suppliers.
Once you cultivate a healthy business relationship with them, which will allow them give out tips that could aid your business, you will be able to please your customers. It is very essential for every business to have a good business relationship with their suppliers.
Tips for Running a Cell Phone Sales & Repair Business Successfully
A cell phone is a mobile gadget that has upped the ante in the field of technology and therefore it is a field that has brought about much competition to both entrants and established businesses. To run this kind of business successfully, you would need to remain proactive as regards the carriers that you sell to the customers. Ensure that your company carries only the best,
You would also need to ensure that you offer excellent customer services, and keep in touch with your customers before, during, and after sales so as to ensure that your customer retention rate is high enough, as this would help in keeping your business afloat while you seek strategies on how to attract more customers to your company.
Lastly, you would need to remain proactive and be able to solve close to 90 percent of problems that your customers might have. You also need to be knowledgeable as regards the cell phone industries and new trends in the industry as well.