Elroy, with all due respect, have you looked properly at Dell?
Dell sell tech hardware. That's very low growth. PCs and peripherals are mature.
That's one component of a two component business. And you've chosen to focus on the low margin element of the business. But, even then, it's not as bad as you make out. Any sustainably profitable operation has my attention - even if margins aren't exciting.
But you have to consider the higher margin and growing "ISG" component of the business - storage, networking and servers. That's where the future of Dell lies. And the future of that is not entirely for me to comment on.
The thread doesn't like Dell. Fine. But, initially, the thread didn't like CCL either. Nor does the thread like WWW or CUTR. But, to an extent, that is my advantage.
It's also possible I'm totally wrong about the future of Dell and I overestimate Michael Dell. I'll learn the lesson at that point but nothing said so far is enough to make me think I've totally lost it.
Do you know the gross margins on PCs are about 5%, and probably less?
Source? At a 5% GM, Dell wouldn't be a functionable business. Dell's product gross margin was 17%... low, but you're statement is off by a little.
Best, |
