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Technology Stocks : DELL Bear Thread -- Ignore unavailable to you. Want to Upgrade?

To: Jorge who wrote (168)	3/15/1998 9:44:00 PM
From: jjs_ynot	Read Replies (1) \| Respond to of 2578

They certainly had it going. However; it's not clear whether it can continue. The cost differential is primarily from three areas as I understand it: 1) about 1 to 2 percent in inventory cost reduction in the turnaround time that DELL is able to achieve (average about 9 days I believe) However; others are emulating this model (I know you're laughing); but Gateway is shipping components (monitor, speakers, etc.) right from supplier to customer and they don't even go into Gateway factory. IBM and others are having resellers such as Staples perform final system integration. The 1 to 2 percent may be wittled away. 2) The Southeast Asian Currency debacle probably gave DELL a competive advantage of about 3 ot 5 percent, since even they admit that it was a windfall that may not be repeated. Thus BTO may still buy parts cheaper but not to the degree that they have during the currency writedown. 3) Inventory writedown costs for IBM, HP, CPQ and others of about 4 percent. This is possibly a nonrecurring event. So competitive comparisons may get toughercin coming quarters.