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Technology Stocks : DELL Bear Thread
DELL 142.68-2.7%Nov 10 3:59 PM EST
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To: Bilow who wrote (1996)10/1/1998 2:43:00 AM
From: Chuzzlewit  Read Replies (1) of 2578
 
Carl,

The truly vertically integrated manufacturer sells only the final product. The point that I was trying to make is that the vertically integrated manufacturer has no advantage other than the theoretical one of making a profit at each level rather than a profit only at the final assembly and distribution level (as does Dell).

In practice vertically integrated manufacturers have severe problems because of accounting difficulties. The issue has always been stated something like this: you treat internal manufacturing no different than an external vendor -- i.e. the price must be competitive. But because of the extreme problems with transfer costs there seems to be a strong bias in favor of internal purchasing.

** OT **

The true nectar of the gods is 18 year old Macallan. Try it. Much better than Glenlivit IMO. Check with Rudedog -- he's a single malt fan also.
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