Value of IT Hardware Business

As per my interaction with my colleague IT Hardware partners, who are in the field of IT for more than 15 years , found that most of them feel financially insecure. We always compare ourselves with others and feel our business is not as lucrative as our friend’s business.

In today’s materialistic world money is an indicator to show man’s success and to some extent I too agree with the same. To earn money in our IT hardware business there are two ethical approaches.

Option A - Go for Volume business, keep less margin and gradually increase your turnover.  Initially you may find it difficult, as due to possibly less turnover, % of expenses may be  more and there may be financial constraints too. But as turnover increases, automatically % of expenses reduces and you start earning more.  Even at 2% of Net margins, profit on say 100 Million sales can be  around 2 Million. Of course we have to select our Partners – both Vendors and clients, with sufficient background checks and due diligence.

Option B - Second way is to create a service or product which is not common, say one can provide niche Solutions for a specific vertical or create higher standards of service which many others fail to give. Once you create that brand or standard by which your company will be known for, trust yourself and keep patience, rewards will come automatically over a period.

Anyone who wants to earn reasonably good, must decide first whether he wants to go for Option A or Option B, but unfortunately, we are always confused and feel that grass is greener on other side. So, we always switch between Option A and Option B. Sometimes we try to increase the turnover and sometimes we try to create product & services which will give us a good margin. This is the main reason of not achieving your goal.

So my advice to all my dear friends select the right option suitable to your strengths & ability,  work hard, trust yourself and keep patience. You will find your destination in the long run reaping the desired benefits. Like investing in a Mutual fund via SIP route; depending on the goal and the time period decide value of SIP (in our case Hard work and dedication) and you will achieve the desired status.

I would like to sign off with following Quote :

"Knowing is not enough; we must apply. Willing is not enough; we must do.”

– Johann Wolfgang von Goethe