How to Write a Business Plan for Computer Repair Service
Follow 7 practical steps to create a Computer Repair Service business plan in 10–15 pages, with a 5-year forecast Achieve breakeven in just 6 months and identify the $818,000 minimum cash needed for startup and working capital in 2026
How to Write a Business Plan for Computer Repair Service in 7 Steps
| # | Step Name | Plan Section | Key Focus | Main Output/Deliverable |
|---|---|---|---|---|
| 1 | Define Service Strategy and Market | Concept | Weighting service focus and setting initial pricing. | Pricing structure ($35–$95/hr) confirmed. |
| 2 | Calculate Initial Capital Needs | Financials | Justifying the $818,000 minimum cash requirement. | CAPEX itemization ($108k total). |
| 3 | Model Variable Costs and Contribution | Operations | Analyzing the 305% variable cost rate impact. | Gross margin needed vs $5,050 fixed overhead. |
| 4 | Project Revenue and Breakeven Point | Financials | Determining customer volume needed to hit June 2026 target. | Required customer acquisition volume forecast. |
| 5 | Plan Staffing and Wage Schedule | Team | Aligning labor costs with projected service volume growth. | 2026 staffing plan finalized. |
| 6 | Detail Acquisition Strategy | Marketing/Sales | Reducing CAC from $120 toward the $90 target. | $24,000 marketing budget allocation defined. |
| 7 | Analyze Cash Flow and Risk | Risks | Validating capital efficiency via EBITDA and payback period. | 19-month payback period confirmed. |
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What specific customer segment needs my Computer Repair Service most right now?
The small business (5-20 employees) segment needs your Computer Repair Service most because their reliance on uptime makes the subscription model, focused on proactive monitoring, a superior fit over reactive residential fixes, which directly impacts the answer to What Is The Most Critical Metric For The Success Of Your Computer Repair Service?
Target Market Focus
- SMBs (5-20 employees) are the primary focus segment needing IT support.
- Proactive remote monitoring drives the recurring monthly income via subscription.
- Home office pros and students need fast, reliable support for daily work.
- This segment defintely requires minimizing costly disruptions to maintain productivity.
Service Pricing Levers
- Revenue streams include subscription, fixed-rate fees, and hourly billing.
- Fixed rates are used for specific, known repair services.
- Hourly rates are reserved for more complex, customized support tasks.
- Transparent pricing helps compete against traditional, reactive repair models.
How quickly can I reach breakeven given my fixed costs and service mix?
You need a positive contribution margin greater than $5,050 monthly to cover fixed costs, but the 305% total variable costs reported suggest you're losing money on every transaction, which stops you from reaching profitability; you must address this cost structure before calculating required volume, which you can research further here: Is The Computer Repair Service Business Currently Generating Profitable Returns?
Covering Fixed Overhead
- Fixed overhead requires $5,050 in monthly contribution margin (CM).
- CM is revenue minus variable costs, but 305% TVC means CM is negative.
- If TVC is 305% of revenue, you lose $2.05 for every dollar earned.
- You can't calculate required billable hours without a positive margin structure.
Breakeven Timeline
- Reaching breakeven by June 2026 gives you about 30 months.
- You need to generate positive gross profit immediately, not later.
- The immediate action is cutting variable costs drastically or raising prices.
- If you achieved a 50% margin, you’d need $10,100 in monthly revenue.
How will I manage technician utilization and service delivery efficiency as demand grows?
To manage growing demand for your Computer Repair Service efficiently, you must immediately define Standard Operating Procedures (SOPs) for on-site work and set a baseline utilization target of 25 Average Billable Hours per Month per technician; this structure lets you accurately forecast when you need to hire that fifth Full-Time Equivalent (FTE) technician, which the plan targets for July 2026. If you're thinking about the cost side of this, Are You Monitoring The Operating Costs For Your Computer Repair Service?
Set Utilization Targets
- Define SOPs for all on-site support procedures now.
- Set a starting benchmark of 25 Average Billable Hours per Month.
- This metric assumes 15.6% utilization (25 hours / 160 total hours).
- SOPs standardize quality and reduce wasted time on routine fixes.
Staffing Growth Projection
- Schedule hiring for the 5th FTE technician by July 2026.
- This hiring date implies you expect demand to hit 125 billable hours monthly.
- Track actual utilization against the 25-hour goal monthly.
- Ensure onboarding processes are tight; defintely don't let training lag hiring.
What is the absolute minimum cash reserve required to launch and sustain operations?
The absolute minimum cash reserve needed to launch and sustain the Computer Repair Service until profitability is projected to be $818,000, which covers initial capital costs and the necessary working capital buffer until the 19-month payback point. Understanding this runway is crucial, so review What Is The Most Critical Metric For The Success Of Your Computer Repair Service? before finalizing your burn rate assumptions; this estimate is based on needing capital through February 2026.
Initial Capital Deployment
- Total minimum cash requirement through Feb-26 is $818,000.
- Initial Capital Expenditure (CAPEX) totals $108,000.
- CAPEX covers essential assets like service vehicles and specialized equipment.
- This initial spend also includes setting up the starting inventory levels needed for immediate service delivery.
Runway and Payback Timing
- The business plan assumes a 19-month period to reach payback (cash flow neutral).
- Working capital must cover operational losses during this entire runway period.
- If onboarding takes longer than projected, churn risk rises defintely.
- The strategy requires securing the full $818k upfront to avoid financing cliffs mid-cycle.
Computer Repair Service Business Plan
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Key Takeaways
- Achieving breakeven for this Computer Repair Service is projected within 6 months by focusing heavily on high-margin services and utilization.
- The startup requires a minimum cash reserve of $818,000, which primarily covers $108,000 in initial capital expenditures for vehicles and inventory.
- Careful management of the 305% total variable cost rate, driven largely by hardware parts (180%), is essential for maintaining gross margin against $5,050 in fixed overhead.
- The service strategy relies on Monthly Monitoring (45% allocation) and Hardware Repair (40% allocation) to generate the necessary billable hours for profitability.
Step 1 : Define Service Strategy and Market
Service Mix Drivers
Define your core revenue streams early; this dictates hiring and tooling needs. If you over-index on reactive fixes, you'll never build predictable income. Your initial service mix must defintely favor recurring revenue potential over one-time fixes to stabilize cash flow.
The initial pricing structure, ranging from $35 to $95 per hour, sets expectations for both freelancers and small business clients. You need high utilization at the higher end to offset the variable costs associated with hardware replacement. This range is your starting point, not your final destination.
Pricing Levers
Your strategy leans heavily on Monthly Monitoring, allocated at 45% of service focus. This recurring revenue stream must be priced to cover fixed overhead easily. If this service doesn't hit target adoption rates, your break-even timeline stretches out significantly.
Hardware Repair accounts for 40% allocation. This is where margins get squeezed by parts costs, which we calculate elsewhere as high. Ensure the $35 to $95 hourly rate applied to repair labor has a clear, documented markup on parts to maintain contribution.
Step 2 : Calculate Initial Capital Needs
Justify High Cash Needs
You need $818,000 minimum cash to launch this computer repair service. That big number isn't just for covering early losses; it includes major upfront asset purchases. Year 1 Capital Expenditures (CAPEX) hits $108,000, which locks up capital immediately. This high requirement means your initial fundraising target must be firm, as you can't generate revenue without these tools.
This initial spend covers the necessary infrastructure to deliver both remote and on-site support promised to small businesses. If you underestimate this, you’ll be scrambling for capital while trying to service your first few clients. That’s a recipe for failure, defintely.
Break Down the $108k CAPEX
Itemizing this $108,000 CAPEX shows exactly where that initial $818,000 cash buffer goes. The bulk of this spending is on tangible assets required for operations. You must budget $25,000 for the service vehicle needed for on-site calls. Also, initial parts inventory costs $18,000 right away.
Here is the required asset allocation for Year 1:
- Service Vehicle: $25,000
- Initial Parts Inventory: $18,000
- Remaining Tools/Software/Setup: $65,000
To manage this, consider leasing the vehicle instead of buying it. That frees up $25,000 immediately, though it shifts that cost into the monthly operating expenses.
Step 3 : Model Variable Costs and Contribution
Variable Cost Shock
Your variable costs are currently 305% of revenue. This is the first thing to fix. Hardware Parts alone cost 180% of revenue, and Vehicle/Fuel adds another 60%. Honestly, this math shows you lose money on every service sold right now. You must understand that cost of goods sold (COGS) cannot exceed 100% of revenue for a viable business.
Covering Overhead
You must cover $5,050 in fixed overhead monthly. With costs at 305%, your gross margin is negative 205%. This model requires immediate pricing adjustment or supplier negotiation. If you don't change this, you can't pay the rent, defintely not while scaling. You need to aim for a gross margin that is at least 100% plus whatever percentage is needed to cover that $5,050.
Step 4 : Project Revenue and Breakeven Point
Volume to Cover Fixed Costs
Hitting breakeven by June 2026 requires aggressive, predictable customer acquisition tied directly to covering the $5,050 monthly fixed overhead. Given the 25 average billable hours per customer, we must establish a reliable revenue capture per client. If we use a midpoint billing rate of $65 per hour, each engagement yields $1,625 in gross revenue. Still, the stated variable cost rate of 305% of revenue means contribution margin is negative, making traditional breakeven mathematically impossible without immediate margin correction.
We must assume that subscription revenue or specific service types generate a positive contribution to cover overhead, otherwise, growth only increases losses. To model the necessary acquisition volume, we calculate how many customers are needed monthly to cover that $5,050, assuming margin improves drastically.
CAC Spend for Growth
To achieve the required volume, we map the acquisition spend against the fixed cost coverage. If we assume a necessary 40% contribution margin—a massive improvement over the current model—each customer contributes $650 ($1,625 0.40). This means you need about 8 new customers monthly to clear the $5,050 overhead.
Acquiring these 8 customers costs $960 (8 customers $120 CAC). This acquisition spend must be sustainable. You are defintely spending $120 to acquire a customer whose lifetime value must vastly exceed this initial outlay, especially since the current cost structure eats margin. This growth path requires acquiring approximately 240 customers by June 2026 to establish the required run rate.
Step 5 : Plan Staffing and Wage Schedule
Aligning Labor to Volume
Getting the staffing schedule right prevents cash burn before revenue hits. Labor is often the largest controllable expense for service businesses like this one. If you hire too early, you drain the $818,000 minimum cash requirement before hitting breakeven in June 2026.
This step connects your operational capacity directly to your sales forecast from Step 4. Understaffing means missing billable hours, but overstaffing means paying salaries when volume isn't there yet. It’s a delicate balance to maintain margin.
Phased Hiring Strategy
Start 2026 with just the $75,000 Owner/Lead Technician covering initial demand. You project breakeven by June 2026, so hiring should follow that success, not precede it. Adding staff before Q3 risks unnecessary overhead.
Plan to onboard a 0.5 FTE Computer Technician starting in July 2026. This phased approach lets you test if the 25 average billable hours per customer forecast holds up before committing to a full salary load. Defintely monitor utilization closely.
Step 6 : Detail Acquisition Strategy
CAC Efficiency Mandate
You must manage acquisition spend tightly to ensure future profitability. The initial $120 Customer Acquisition Cost (CAC) eats into margins quickly, especially when variable costs run at 305% of revenue due to parts and fuel expenses. For 2026, you have $24,000 earmarked for marketing efforts. This spend isn't just for growth; it's specifically aimed at driving down that CAC toward your Year 5 target of $90.
If you don't improve efficiency, hitting even the modest $58,000 EBITDA in Year 1 becomes risky because acquisition costs will swamp early revenue gains. Remember, you need customers to stick around long enough to cover the high cost of goods sold before marketing costs become sustainable. That’s the real focus here.
Hitting the $90 Goal
Focus the $24,000 allocation on channels that yield high-value customers, specifically those likely to sign up for the subscription model. Since hardware parts alone cost 180% of revenue, every acquired customer needs to generate strong lifetime value to cover the initial marketing outlay plus high COGS.
Test smaller, targeted campaigns first. If you spend $2,000 monthly, you acquire about 16 customers initially ($2,000 / $120 CAC). You need to prove those customers generate enough revenue to justify the spend. Defintely track conversion rates by channel immediately to see where the $120 cost is coming from.
Step 7 : Analyze Cash Flow and Risk
Viability Check
Founders must see the path out of initial cash burn; the 5-year forecast proves this scalability. Year 1 EBITDA lands at $58,000, showing you cover operating costs early on. By Year 5, EBITDA scales dramatically to $830,000. This jump proves the subscription model drives high leverage once customer density is achieved. It’s a clear signal of long-term viability.
Efficiency Metrics
The payback period shows when invested capital stops draining cash. A 19-month payback is aggressive, especialy given the high Year 1 CAPEX of $108,000. This rapid return means your money isn't tied up long. If you hit that 19-month mark, the business starts generating pure profit on prior investment. That's capital efficiency in action, defintely.
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Frequently Asked Questions
Most founders can complete a first draft in 1-3 weeks, producing 10-15 pages with a 5-year forecast, if they already have basic cost and revenue assumptions prepared;