Jump to content
Sign in to follow this  
USMC-Retired

So you want an internet cafe

Recommended Posts

USMC-Retired

The biggest thing is people you can trust. As for the computers I repair them I maintain them. This makes life better and it seems the computers work better after I do my own repairs.

 

The biggest outlay of cost is just in upkeep of the shop. We spend about 2,000 pesos a month replacing worn out things. This is not a mandatory thing. However we do not want to lose customers because we have crappy keyboards with no letters or no mouse pads. It seems that is the biggest thing to keep the shop running and keeping our core customers.

 

We still charge 15 pesos an hour. However we have a new pricing plan 2 Hours for 25 pesos and 3 Hours for 30 pesos. These are good for business. We find that people will sit for 3 hours now in one sitting. Instead of asking for extensions which makes them think about spending more money. So we get that 30 pesos up front. The computers are using 2 pesos an hour in electric. This has increased our business and profits.

 

I have kinda out layed the costs for everyone. 10 PC Shop is about 3000 USD to open up. 20 PC shop right at 5000 USD to open and start. So if you have 20 PC shop your are talking 240,000 pesos. (give or take a little and going cheaper) Expenses every month with rent internet electric and salaries is going to be about 23,000 pesos a month. You would need to make 36,000 a month to break even on costs in 18 months. So lets break that down even farther. You will need 2400 hours of usage for the entire shop for the month. Then if you break that down one more step. You need 80 hours of usage per day or 4 hours per computer. Then if you go farther with this you have to average at least 1200 pesos a day.

 

So look at this perspective. The average 20 computer shop will net about 13K a month. I have had 3 shops and still operate one of those shops. 2 of them I did not follow the rules I set forth in the first post of this thread. LOCATION.

 

Is this a good business for anyone that comes here. NO it is not. You have to have an intense knowledge of computers or a huge willingness to learn. You have to be prepared to spend sometime with upgrades and keeping you above the others. However adding an extra 13,000 pesos a month is nice. Which less then what we actually profit each month.

 

Just as a note Crazy Karts is a free download game from Level-Up games. It is one of our most popular.

 

List of games we are running

Left for Dead

Battle Field 1942

Counter Strike (all of them)

Free Style

Vanro

Ragnor

Grand Theft Auto (all of them)

Halo

NBA 2009

Dota All Stars

 

However there are lots more games. But just a few of the popular.

Edited by USMC-Retired

Share this post


Link to post
Share on other sites
mattwilkie
The biggest thing is people you can trust. As for the computers I repair them I maintain them. This makes life better and it seems the computers work better after I do my own repairs.

 

The biggest outlay of cost is just in upkeep of the shop. We spend about 2,000 pesos a month replacing worn out things. This is not a mandatory thing. However we do not want to lose customers because we have crappy keyboards with no letters or no mouse pads. It seems that is the biggest thing to keep the shop running and keeping our core customers.

 

We still charge 15 pesos an hour. However we have a new pricing plan 2 Hours for 25 pesos and 3 Hours for 30 pesos. These are good for business. We find that people will sit for 3 hours now in one sitting. Instead of asking for extensions which makes them think about spending more money. So we get that 30 pesos up front. The computers are using 2 pesos an hour in electric. This has increased our business and profits.

 

I have kinda out layed the costs for everyone. 10 PC Shop is about 3000 USD to open up. 20 PC shop right at 5000 USD to open and start. So if you have 20 PC shop your are talking 240,000 pesos. (give or take a little and going cheaper) Expenses every month with rent internet electric and salaries is going to be about 23,000 pesos a month. You would need to make 36,000 a month to break even on costs in 18 months. So lets break that down even farther. You will need 2400 hours of usage for the entire shop for the month. Then if you break that down one more step. You need 80 hours of usage per day or 4 hours per computer. Then if you go farther with this you have to average at least 1200 pesos a day.

 

So look at this perspective. The average 20 computer shop will net about 13K a month. I have had 3 shops and still operate one of those shops. 2 of them I did not follow the rules I set forth in the first post of this thread. LOCATION.

 

Is this a good business for anyone that comes here. NO it is not. You have to have an intense knowledge of computers or a huge willingness to learn. You have to be prepared to spend sometime with upgrades and keeping you above the others. However adding an extra 13,000 pesos a month is nice. Which less then what we actually profit each month.

 

Just as a note Crazy Karts is a free download game from Level-Up games. It is one of our most popular.

 

List of games we are running

Left for Dead

Battle Field 1942

Counter Strike (all of them)

Free Style

Vanro

Ragnor

Grand Theft Auto (all of them)

Halo

NBA 2009

Dota All Stars

 

However there are lots more games. But just a few of the popular.

 

One major factor i did notice about gaming in the Philippines though is its a few years behind the West. Not only in games but interest keeping the games uncomplicated makes a big difference. E.g. games that involve a lot of specific tasks or controller/keyboard movements people dont like. Not sure if its something that will change over time.

Share this post


Link to post
Share on other sites
mattwilkie
Can you explain more about how you set this up? How much is based on trust and how much is legally binding, at least in theory?

 

Everything is on charts I have set figures taken on a daily basis that are inputted onto a spreadsheet so i can keep an eye on how things are going but also shows where things need help or anything odd happening. Trust is an important factor and the people who do work for me I trust 100% but they are also not on

a salary they are on a profit share which basically means the more they sell the more they earn. Which can be as much as P17k for one person in one project. Legally binding depends on what your doing.. e.g. you have all the receipts for all the equipment in a business its pretty obvious its yours. But as projects get bigger I will have to look to get lawyers involved but not because I dont trust the people im associated with but the fact if someone dies what then? How do you recover the business.. At the moment its not a problem

Share this post


Link to post
Share on other sites
mattwilkie

netcafe5.jpg

 

Internet cafe under construction.

Share this post


Link to post
Share on other sites
jaimezee

"Deep freeze the computer"

 

huh??? You didn't say anything about needing a freezer.

Share this post


Link to post
Share on other sites
jaimezee

"Deep freeze the computer"

 

huh??? You didn't say anything about needing a freezer.

 

OK -- I googled it -- http://www.faronics.com/

Share this post


Link to post
Share on other sites
OldSchool

I would be interested in knowing more about the legal business structure. But maybe I already know the answer? These are operations run/managed by pinay wives, with the westerner as silent partners? Its a totally Philippines business owned by Philippinos?

 

So no way you can import the pc's tax-free?

Share this post


Link to post
Share on other sites
Googy

The biggest thing is people you can trust. As for the computers I repair them I maintain them. This makes life better and it seems the computers work better after I do my own repairs.

 

The biggest outlay of cost is just in upkeep of the shop. We spend about 2,000 pesos a month replacing worn out things. This is not a mandatory thing. However we do not want to lose customers because we have crappy keyboards with no letters or no mouse pads. It seems that is the biggest thing to keep the shop running and keeping our core customers.

 

We still charge 15 pesos an hour. However we have a new pricing plan 2 Hours for 25 pesos and 3 Hours for 30 pesos. These are good for business. We find that people will sit for 3 hours now in one sitting. Instead of asking for extensions which makes them think about spending more money. So we get that 30 pesos up front. The computers are using 2 pesos an hour in electric. This has increased our business and profits.

 

I have kinda out layed the costs for everyone. 10 PC Shop is about 3000 USD to open up. 20 PC shop right at 5000 USD to open and start. So if you have 20 PC shop your are talking 240,000 pesos. (give or take a little and going cheaper) Expenses every month with rent internet electric and salaries is going to be about 23,000 pesos a month. You would need to make 36,000 a month to break even on costs in 18 months. So lets break that down even farther. You will need 2400 hours of usage for the entire shop for the month. Then if you break that down one more step. You need 80 hours of usage per day or 4 hours per computer. Then if you go farther with this you have to average at least 1200 pesos a day.

 

So look at this perspective. The average 20 computer shop will net about 13K a month. I have had 3 shops and still operate one of those shops. 2 of them I did not follow the rules I set forth in the first post of this thread. LOCATION.

 

Is this a good business for anyone that comes here. NO it is not. You have to have an intense knowledge of computers or a huge willingness to learn. You have to be prepared to spend sometime with upgrades and keeping you above the others. However adding an extra 13,000 pesos a month is nice. Which less then what we actually profit each month.

 

Just as a note Crazy Karts is a free download game from Level-Up games. It is one of our most popular.

 

List of games we are running

Left for Dead

Battle Field 1942

Counter Strike (all of them)

Free Style

Vanro

Ragnor

Grand Theft Auto (all of them)

Halo

NBA 2009

Dota All Stars

 

However there are lots more games. But just a few of the popular.

 

Just a quick question well two.

 

1. What size pc do you recommend to use for a server?.

 

2. With games, do you need a copy for each pc or do you just buy 1 copy and load in a crack so that it will run without the cd in the drive?

Share this post


Link to post
Share on other sites
Terp
Just a quick question well two.

 

1. What size pc do you recommend to use for a server?.

 

2. With games, do you need a copy for each pc or do you just buy 1 copy and load in a crack so that it will run without the cd in the drive?

 

You might have to wait on a reply from USMC-Retired, he's hasn't posted in over a month or so.

 

The probable reason is he's in the States and won't be back in the Philippines for another couple of weeks or so I've been told.

Share this post


Link to post
Share on other sites
chrisdauin

I typed up a little how to. This is what you need to do to set it up.

 

So you want to start an internet cafe...

 

First it is about location.

 

You first need a location that has street access. It must be visible for everyone to see. People are lazy so close to the road is ideal. Having a sign letting people know you are there is important. Find a location that will support your cafe remember people are lazy so it needs to be near a community. Also passing jeepny's trikes and other vehicles is important.

 

Second

 

So you now have the location. Lets look at the set up. You need 30" X 4' of space per computer. So calculate in how many computers you can filter into the space. Remember you want people to stay on the computer for a period of time. Do not skimp on the chairs. They are what provide comfort for the computers. Also you customers do not want someone right behind them and keep banging their chair. so consider all of that when designing the space. Carpet or Hard floors. I say go with hard floors. Reason people are messy and the dust from the vacuum will cause a problem. Also get your CPU up off the floor.

 

Third

 

Target the market. Are you going for the gamers or chatters. You can not have it both ways. For the gamers you need to ensure you have what the public wants. Go to the internet cafes and see what games are on the machines in the area. Ensure you have tournament for the gamers. I do this once a week. It is vital to your success. Give free hour to the winners. They like it and will come back to practice. If you go with the chatting idea then you need to have headsets and webcams. I recommend headsets for both.

 

Forth

 

You will also need to have quality printing. Lazer printers are cheap and you save in the long run. Toner is cheaper then ink. If you have color printing then get a continuous ink feed printer for the printing. This is a conversion for the printers.

 

Fifth

 

Computers well this can very with opinion. However here is what I use. For the chatters I have 1.6 celeron computers with 1 gig of memory. No graphic cards. For the gamers I have 2.8 P4 with a 256 graphics card 1 meg of memory. That all seems to do the trick. hard Drive as long as it all fits.

Monitors LCD is the only way to fly. CRT is hot and burns lots of electric. So go LCD.

 

Sixth

 

Hardware, You will need to have a router. The 4 port variety will do. Then you will need to switch out from there. Do not get cheap here buy a good router. Lynksys is a cisco system and netgear makes good routers. Switches you can get a little cheap here.

 

Seven

 

Software. Ok so you need to ensure you get licensed software. Philippine Anti Piracy board is hot and heavy here. The fine is high. They are funded by microsoft so they look mainly at that. So operating system needs to be microsoft and that is what people like. Word processor we use open office. Then we have skype, yahoo, firefox, Msn, Few other chat programs. As for a server client we use another free program called handy cafe. Also deep freeze your computers. This will prevent viruses and other attacks on your computers. Nice to have a fresh start every time you turn it on. The rate you need to charge has to be no less then 15 pesos an hour or you will lose money. Your computers are using 4 pesos an hour so keep that in mind.

 

Eight

 

Internet. So many people cheat on this. However do not. You need 1 meg of dedicated speed for every 10 computers. Do not get that home connection get a regular business line. Little more money however service is better. Go with PLDT if you can just better service with PLDT.

 

Nine

 

You are open and you have no customers. Several things you can do. People love free. We opened in two locations and the first day was free. No charge come in check it out. Then we handed out to everyone that came in a coupon for free half hour with an hour purchased. We do alot of promotions. We had a cell phone give away. One coupon per 2 hours straight of internet usage. Free 10 hours of usage raffle one coupon per every 90 min of usage. Then we have the some other creative things. Wednesday is our slow day. So we had a free hot dog night. Drove our sales out of the roof. People love free and do not be afraid to give back. We had the PacMan Fight live. No charge found it online streaming and just put it on the computers. So be creative.

 

Ten

 

Be prepared the first 3 months you will just break even. So do not worry it may not be you. It is easy to see this as a money pit however it will pick up if you continue to promote your idea. Continue to build a dedicated client list. Tournaments and promotions. Always keep your promotions so they expire.

 

Eleven

 

Employee. Family is always best. I go in and audit the records alot. I make sure that people see me calculating the money in the drawer what is said in Handy Cafe. I have found errors and I point them out. I may not do anything however I show them how I look for these errors. They can not get into the screen I am in so they do not know this till the first time I look at it. It keeps them honest. Also I find it best to pay weekly. They seem to have more money through the week and less chance of theft. However it is hard to cheat when the server knows you turned on the computer and records the charges and time. They will try though so you have to stay on top of it.

 

Twelve

You need to registrar your name with DTI. Then you have to go to BIR to registrar to pay taxes. Then you need a mayors permit. If you are in Cebu proper you have to pay association dues. Also you need a fire permit. This will cost about 8,000 and is included below in misc costs.

 

 

Last but not how much does it cost.

 

For a

10 computer set up and server

11 computers that 175,000

Licenses Microsoft 22,000

Chairs 7,000

Refurbish building 13,000

Routers switch wires 9,000

printer X2 9,000

Web cam Headset 9,000

Misc 12,000

 

 

The projections for return on investment is about 18 months. That is charging 15 pesos an hour and 6 hours of usage per computer per day. The net profit for the same would be around 13,000 pesos a month. Granted your Electric is 2K Employee 2K and internet 4K rent is 6k. Your location is going to be the most important decision you make. So scope out many many places.

 

Hope this helps any that have interest in doing what I did.

 

 

USMC thank you and everyone for all the great information on this topic. I'm a new member to this forum and cannot pm anyone yet, I would like to discuss this with you 1 on 1. Would you please pm me so that we can discuss this. Thanks

Share this post


Link to post
Share on other sites
mattwilkie

Can you explain more about how you set this up? How much is based on trust and how much is legally binding, at least in theory?

 

All ventures I have operate on a 50% ownership with the employees. Its mainly trust but then again I know I can trust them. Also the businesses are starting to piggy back off each other ie. the next ventures come out of profits of the other businesses. So far all my monthly expenses are paid and giving a growth of around P15,000 a month doesnt sound a lot but I dont have any bills to pay and a fund thats increasing regular as other things are opening up. I have also been lucky on this trip back to the UK as ive managed to secure some buyers who own cash and carrys just need to find the right products to export to them.

 

The other thing I should meantion is the whole idea was to cover my monthly expenses so I can start putting money into other ideas. Most business ventures in the Philippines have some degree of success the problem can be sustainability if people start to lose interest or the profit margins are tight though.

Share this post


Link to post
Share on other sites
beach

Internet cafes are now making 15 to 20 pesos an hour... I did a business plan in 2005 to see the feasabilty on it and the profit all depended on food, drinks to make any sort of profit. Had a site planned out 1 block from a university on a main street but 8 competitors within 2 blocks. (You better be selling food or something to make money. When I got here, they were making P35 to 40, even in the Province.

 

I use Deep Freeze (faronics.com) in the studio and it works great, once you get used to not being able to save anything on your system drive. No more viruses, defragging the disks etc. BUT, it does take some getting used to. Cheaper than using a paid for anti-virus, since you really don't need anymore (if you are sure you don't have a virus, when you "freeze" the system) lol!

Share this post


Link to post
Share on other sites
lewbert

This is a good business and always in demand.

Share this post


Link to post
Share on other sites
dablindfrog

 

 

Also, I was toying with the idea, how about half set up for computer chatters and the other half set up with gameing systems like xBox and WI ? How do you think that might fare?.

 

 

 

there is one such place on magsaysay avenue in Olongapo and it's full all the time, they charge 300/hour for Wii with the drumkit/guitar setup and as i said it's full, peoples waiting on couches for their turn to play

 

i think when it's done well it can work

 

(that place does have a SUBWAY set-up that seems to be doing really well too)

Share this post


Link to post
Share on other sites
Mr. Mike

I may have missed something but "security" for your cafe must be an issue. Lots of expensive equipmment in one place. How do you address that?.................At what point will this type of business start to saturate the market, if ever!

 

Thanks for volunteering you knowledge and expertise.

Share this post


Link to post
Share on other sites
Guest
This topic is now closed to further replies.
Sign in to follow this  

×
×
  • Create New...

Important Information

By using this site, you agree to our Terms of Use, Privacy Policy and Guidelines. We have placed cookies on your device to help make this website better. You can adjust your cookie settings, otherwise we'll assume you're okay to continue..