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Technology Stocks : Dell Technologies Inc.
DELL 127.92+0.4%Dec 30 3:59 PM EST
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To: Chuzzlewit who wrote (24945)12/12/1997 4:03:00 PM
From: Meathead  Read Replies (2) of 176387
 
Sub-zero wholesale costs really depend on many quality and
capabaility variables. You can build one dirt cheap using
AMD's processor and cheap floppy, kbd, HD ect for about
$350. I would put Compaq's $799 presario wholseale
hardware price at about $600, same as ed's figure,
plus or minus 5%.

My point is ed's assumptions about individual component
costs are off. Compaq's $799 box has a certain level of
quality and it will cost X amount of dollars for that
quality at any given time.

To say one can build a sub-zero for $300 or $400 and apply
that as a basis for figuring Compaq's margin is stupid.
That's the basis for a retail $500 box.

When you do the math, as you already have, it's easy to
see that on average, margins will fall between 2% and 5%
with breif periods outside of this range as a result of
numerous ever changing supply/demand/cost factors.

MEATHEAD
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