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

To: ed who wrote (34434)	3/15/1998 6:57:00 PM
From: Chuzzlewit	Read Replies (1) \| Respond to of 176387

How in the world can you contend that the advantage Dell got from the BTO model has been eliminated. It was Compaq's attempt to emulate a portion of that model that got it into so much trouble. The difficulty is this: Dell's BTO model is a "pull" model, whereby orders from customers trigger assembly and inventory decisions. Compaq's system is a "push" system because it relies on sales forecasts for inventory purchasing. So long as final assembly is in the hands of the channel it will be an inherently less efficient model than Dell's, if for no other reason, the fact that there is an additional cost (profit) center -- the channel. So emulation of the model requires a JIT assembly system, and that can't be done so long as CPQ relies on the channel. So, your statement is completely incorrect. Regards, Paul

To: ed who wrote (34434)	3/15/1998 9:19:00 PM
From: qpd	Read Replies (1) \| Respond to of 176387

Business Week March 23, 98 Analysis of PC industry By Peter Burrows in Palo Alto, Calif., with Gary McWilliams in Houston, and Robert D. Hof in San Mateo, Calif. A long article here is an excerpt from it. Long live Dell Longs! "That means computer makers must adjust costs now or wither. The No.1 cost-efficiency mantra is death to inventory: by letting resellers assemble computers as orders come in from customers, PC makers can limit the amount of inventory in stock and get it sold faster, before prices fall. Yet while Compaq and IBM intend to use such tactics, they'll still be far behind direct-sales juggernaut Dell Computer Corp. The build-to-order king, whose costs are roughly nine percentage points less than rivals, continues to roll along. Michael Kwatinetz of DMG Technology Group expects Dell to post a 50% jump in profits, to $294 million, on a 49% rise in sales this quarter."

To: ed who wrote (34434)	3/15/1998 9:41:00 PM
From: Jorge	Read Replies (1) \| Respond to of 176387

CPQ is willing to turn inventory over somewhat slowly at first, then as they get ODM established and everything is running smoothly their ultimate goal is to turn inventory 30 times a year.....DELL is already at 52 times......George