In looking to help those considering depot repair centers to service and maintain their POS and IT hardware, the fourth part of this series covers the important pricing element of the decision.

The depot repair model can offer excellent value, but still you need to choose a system that suits. Evaluate the different methods available and ask providers to give you repair pricing based on different methods.

Those common in the industry include:

Photo credit: 401K

Time and Material (T&M)

This is a method often preferred by the Original Equipment Manufacturers (OEMs). You ship defective equipment to them then they will evaluate it and provide a repair price.  Repair pricing can be based on labor rates from $80 to $200+ per hour. They may also charge an evaluation fee if you decide not to proceed with the repair. In addition, the T&M process may not be manageable if you have large volume of repair work.

Contract Method

With this pricing model, you pay a certain amount per month for each item of hardware that you place under the repair contract. Typical pricing ranges from a few dollars for a barcode scanner to $20 plus per month for premium mobile computers or other expensive IT equipment.

The great advantage to this method is that your total repair costs are known upfront. Anything that goes wrong with the equipment listed in the contract is covered and the equipment will be repaired at no further cost.

However, this method is typically an expensive way of repairing your equipment. When pricing this way, the repair company has to assume the worst in terms of how much equipment will need repairing. Each type of equipment can be judged on the typical number that will come in for repair during any one year, but still the repair company will have to err on the safe side and price the contract so that they don’t lose money.

Another disadvantage to this method is that you must maintain an accurate record (with serial numbers) of the equipment that you want covered, which can be tricky with hardware spread far and wide in the field. Any equipment that you don’t list upfront with the repair company may not be covered.

Again, this contract method may be popular with OEM’s and some third party repair companies as it can be most profitable - for them!

Flat Rate Repairs

The flat rate repair pricing method is probably the most popular in the industry.

The depot repair company charges a set amount per unit repaired and this includes all parts and labor. The price is set up front and it varies depending on what is being repaired. There is a typical range of between $70 to $100 for some barcode, POS hardware or monitor repairs up to a few hundred dollars for high end label printer repairs.

Typically the price is around 15% to 40% of the cost of buying replacement equipment, so it offers excellent value. Normally these repairs are not covered by a formal contract and you pay only for what you send in to have repaired. If your repair needs change, or if you’re unhappy with the provider, then you can just stop repairs and move elsewhere.