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

To: Jorge who wrote (59688)	8/19/1998 10:50:00 PM
From: stock bull	Read Replies (1) \| Respond to of 176387

Jorge & ALL, I'm sure that Dell purchases all the component parts and subassemblies through the use of annual contracts. Of course, these contracts may be longer in duration. Further, I'm certain that Dell has taken the necessary precautions to protect themselves from sudden price increases. Dell is now sufficiently large enough as to carry "big time" clout with their suppliers. Thus, any prices increases to Dell from their supplies will be well managed, as the rest of their business is. No way will the CFO let any one shove it up his *ss. JMO Stock Bull

To: Jorge who wrote (59688)	8/19/1998 11:19:00 PM
From: Chuzzlewit	Read Replies (1) \| Respond to of 176387

George, you asked is it possible price increase notices may be given in advance by component companies which would allow DELL to buy "extra" to cover a transition period, thereby nullifying most of this concern? Two comments, First, the history of technology is price decreases. Even in the face of outrageous inflation during the seventies and early eighties prices decreased on virtually every conceivable technology item. But beyond that, the key to Dell's success is maintaining as little inventory as possible. That's how they manage to get a 217% ROIC. Inventory does not earn. It sits there and it costs money to store and to move around. It only earns money for Dell when it reaches the customers' hand. This is the essential idea in JIT manufacturing. TTFN, CTC