JP,
>>> Once the End PC markets start to stregnthen, DELL JIT model will be their ultimate demise. <<<
Interesting concept! By the End PC, I assume that you are referring to the idea that it would be 'quicker' to buy a computer 'off the shelf' that to order one from DELL. (Have I got the scenario correct here?)
On that premise, in order for that to work successfully, the PC market would have to reach the 'optimum' plateau, where a 'standard' configuration could be 'forecast' and shipped to the stores via some sort of 'channel' arrangement. (So far so good)
Now with the BTO-JIT model, if the 'standard' configuration was 'frozen', just how fast could DELL 'fill (plug)' a channel? Well, the faster the better, since the Cash Conversion Cycle for DELL is some kind of fantastic, I believe that DELL could fill the 'orders' to channel stuff as fast as his suppliers could deliver the required parts. Since DELL is in communication with his suppliers via the Internet every couple of hours, the 'gear up' would be within a matter of 'hours' not 'days' or 'weeks'! IT IS THE MODEL that can handle any scenario!
I can just see Intel in 'tears' as DELL places that order for 10 million Intel boards with the 'xyz' chip set and 'qrp' processor! Don't forget HP and the 10 million 'hpz' printers! These boys be crying all the way to the bank! And that little CCC glitch where DELL gets the interest on the $$$ between 'ship' and 'pay'. Ah yes!
My only question is whether DELL could find a way to fill the 10 million order, and continue to fill the 'custom' orders that are now being done? Whoops, I forgot, this is M.S.DELL we are talking about here! He'll have a plan in - oh, say - 10 minutes!
Regards,
Ken
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