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Technology Stocks : PC Sector Round Table -- Ignore unavailable to you. Want to Upgrade?

To: Mark Oliver who wrote (356)	5/16/1998 7:06:00 PM
From: Frodo Baxter	Read Replies (2) \| Respond to of 2025

>I think the key to Dell inventory is demanding all suppliers hold inventory for them. That's the whole point. If you're a supplier to Dell, you have to give asset management concessions. But these concessions are not free. They come at the expense of other concessions, most notably pricing. In a perfect world, they would exactly cancel out... (they probably don't and are in Dell's favor most of the time, though) Still, I don't think Dell's inventory management is all that much more economically relevant than Compaq's selling out their accounts receivables. Sure makes the balance sheet numbers very pleasing to the analysts, though. IMHO, the wild success of the Dell is mostly due to cutting out middlemen, not to inventory management. For instance, think about the financial brokers: Merrill Lynch, Charles Schwab, E-Trade... all owe their stunning rise to disintermediation.