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

To: Jim Patterson who wrote (35081)	3/20/1998 4:15:00 PM
From: SecularBull	Respond to of 176387

DELL has the luxury of being able to fine-tune margins to gain market share. DELL chooses to bite the bullet (hardly tough medicine to swallow) of lower (flat) margins for the benefit of increased market share. If you think that this isn't the case, I'm sorry...

To: Jim Patterson who wrote (35081)	3/20/1998 5:14:00 PM
From: Chuzzlewit	Read Replies (2) \| Respond to of 176387

This is the most inane argument I have ever seen. Dell can do what it likes because it is in the driver's seat. It could opt to skim profits while its competitors unload obsolete inventory, ot it could go for the jugular and drop prices at its discretion . Compaq is the company that needs to react, because Compaq is the company with the problem, not Dell. Huge amounts of obsolete inventory is an albatross around Compaq's neck not Dell's What does it take for you to see those simple facts? Paul

To: Jim Patterson who wrote (35081)	3/21/1998 3:15:00 PM
From: ratan lal	Read Replies (1) \| Respond to of 176387

Jim You know $500 profit on 2300 is a greater margin than $500 on 2500. Please show me evidence that DELL realises increased margins every time INTC cuts prices, or any other component for that matter. You have answered your own question. If INTC drops prices and DELL passes on all the reduction then presumably the price of the system will fall ($2300 in your example from $2500). The profit remains at $500. So the 'MARGIN' increases. Now if the sales increase (greater by 2500/2300) and the "MARGIN' has increased then overall $$ profit also increases. Finally evn if total sales $$ (not # of units)remain the same, margin increases, then $$ profit will also increase. I hope this is as confusing to you as it is to me. ratan