Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

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

To: Meathead who wrote (48841)	6/24/1998 12:39:00 AM
From: rudedog	Respond to of 176387

Meat - see my response to Chuz exchange2000.com I think the real margins are 20% to CPQ. You are exactly right that the retailer makes his money on the options and service contracts, and so does the salesman. The base computer is the horse that pulls those sales through. I discuss the $699 / $799 strategy in that response also. I think if we keep digging we will find that CompUSA makes about 2% on the base box under the best case scenario on a markup of about 25%. I agree that a year ago the cost was certainly higher, but so were the prices. CPQ continues to work to higher levels of integration and lower cost in the consumer line. The $450 number is for the current products. I understand that the goal is a cost of $300 to $350 for the year-end products. These are all for the lowest end of course, there are a whole range of prices for the bigger systems (in this case bigger is not necessarily better IMO!). I'm not sure the $450 number is fully burdened - there's only so much info you can expect after a couple of beers!! Great comments as usual, appreciate your interest in my posts.