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Technology Stocks : Dell Technologies Inc.
DELL 133.180.0%12:59 PM EST
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To: Mohan Marette who wrote (72808)10/17/1998 11:57:00 PM
From: Chuzzlewit  Read Replies (1) of 176387
 
Mohan, that's why Tom Meredith won the title CFO of the year. Remember the implications of the negative cash conversion cycle are that cash is received from the customer prior to Dell having to use it to pay its suppliers. Thus, all of its capital needs to fuel growth can be supplied by customers regardless of the growth rate. I know of no other company like that.

The three key elements in the strategy are:
1. Receive payments from customers as rapidly as possible;
2. Keep inventories as low as possible;
3. Keep payables as high as possible.

So, you have

CCC = Days in Inventory + Days Sales Outstanding - Days in Payables

TTFN,
CTC
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