Hi David,
> What sort of size are these cafes and are they
> really profitable based on
> computer services?
The cafes around our town vary in size. I have seen
"cafes" with 1 or 2 machines, and the largest places
in town have about 25 to 30 machines (we have 25 right
now, but we are still expanding). Can they be
profitable, sure! We've been open only 1 month and we
are already turning a profit. We are sort of unique,
though, the only cafe within 300 miles of here that
has a satellite connection (DirecPC), so our
connection is fast. Other cafes have very slow
connections, it can take as long as 15 minutes to load
a page like cnn.com. We offer internet surfing,
network games and also Sony Playstation games. About
80% of our business is internet, though. The other
cafes in town are about 80% game revenue, since their
internet connection is so bad.
> i.e.. As it is a developing country, do you also
> have to keep prices down?
Yes, prices are very low, but our operating are very
low too (except our internet connection, which is
higher than in the States). We charge 35 Pesos per
hour, which is equal to about 75 cents US per hour.
However, based on our expenses, if we can earn 2000
Pesos per day that is our breakeven point. Yesterday
our revenue was about 5000 pesos, so not bad.
> Can you realistically offer high tech machines or is
> that totally
> unnecessary in your environment?
All of our machines are AMD K6/2's at 500MHz with 10Gb
hard drives, 64Mb RAM and 15" monitors. They are not
bad machines. We are able to buy that class of
machine here for about $500 or so. Based on our
current average revenue, we should be able to recover
all of our startup costs in about 1 year and 8 months.
We do have some ideas to help bring in more revenue
too.
> I suppose there are completely different parameters
> involved in your setup.
Yes, operating a business in a third world country is
much different than doing it in a place like the USA
or Europe. No doubt about that. There is a lot of
red tape here, getting government permits and such is
a real headache. But, labor is cheap, so I generally
hire people to do the "dirty work".
Bob Martin
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