Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Technology Stocks : Dell Technologies Inc. -- Ignore unavailable to you. Want to Upgrade?

To: bonnuss_in_austin who wrote (165594)	5/28/2001 1:14:01 PM
From: stubba	Respond to of 176387

Bonnuss - Dell is always looking for ways to lower the total cost of ownership for their customers. There are at least two potentially very large stumbling blocks with moving the mfg/assembly operation to Asia/Pacific. The first would be shipping costs and second would be lead times. The difference between shipping a pc from Austin/Nashville vs. Asia Pacific to anywhere in North America would be considerable when compared to total cost of unit. DELL sources great deal of components from the Asia/Pacific region so there would be some savings involved by not shipping those parts all the way to the US but IMHO it would be near impossible for those savings to outweigh the increase in shipping costs of entire unit. Even if for some reason Dell was able to figure a method to save money even with the higher shipping included, the lead times would likely become unacceptable for most customers. Adding 2-3 days to shipping directly from Asia/Pacific would probably push some customers to other vendors. I am no longer current on all the various custom/tariff duties that may apply but in the past there were serious rate differences between individual raw components and assembled/complete pc's. I recall at one time there was a significant difference in rates between completed notebook computers coming from Asia/Pacific into the United States when the only difference was a processor being included. This meant there was tremendous savings by having someone in the US simply plug in the processor when the machine arrived in US. Obviously that savings had to be weighed against the actual cost of staff performing the work, plus the add'l handling cost and the potential problems that might be created due to that add'l handling. I guess my whole point is that moving offshore for assembly wasn't a slam dunk 3-4 years ago and I can't imagine that things have changed enough to make it any different now.