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To: kahunabear who wrote (20626)	3/8/1998 2:25:00 AM
From: ed	Respond to of 97611

Previously, before the BTO business model was implemented, the BOX makers just make a prediction about the sales , then decide to build ### this many of inventory of PCs, and they place order for the components which should be delivered in certain period of time, say one to two months. Then the FAB start to start wafers to manufacture the components, and take about one to one and one half months for the components to be manufactured, when the components are ready , shipped to the customers immediately, so the components were never put into inventory of the manufacturers. After the BTO models was implemented, the box makers only place orders after they receiving orders from their customers, and the requirement for the components suppliers to deliver the components is immediately. Now, the problem is how the components manufacturers can deliver the components immediately right after they receive the orders from the box makers ? The answer is build huge inventory to meet the on time delivery policy. That is the reason why you see all those components manufacturers , chip manufacturers, disk driver manufacturers, including INTEL , all end up with heavy inventory problems since last years .Because all the box makers cunducted this BTO business model.