correct as usual. CPQ is king of the consumer space, I believe they sell more than the next 3 players combined. Rod Schrock is a savvy, driven guy and he has not sold under margin target in years. Each new cycle he refines his model, drives out cost, and kicks someone else's a$$. I expect profitable $499 machines from them soon, and equally profitable machines under $300 in the near future. Then you start to hit the impulse buyers - 'Honey, don't you think we ought to buy a couple of those for Christmas gifts?'.
There is no way that Dell can get anywhere close to that target, and they have no plans to try IMO. Consumer products are maximized for absolute lowest production costs period. Set the build plan 120 days ahead of the sales cycle, lock in supplier arrangements, hammer those puppies out in a single production run, and ship them to dealers right off the dock. No muss, no fuss, no inventory, no configuration issues. And they always have orders for more than they can build. That's why the consumer part of the business has been growing at 100% per year. |
