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> " Robert, does this or does this not tell you something? Quantity
> discounts aside, this should tell you that IBM can sell these things at
> a *lot* lower price and still make money. Now I don't expect the
> consumer to get OEM prices, but paying well in excess of 2x as much
> as the OEM does is a pretty nifty trick."
>
> A factor of 2 is normal in OEM deals, the disks that you think are such
> good buys at $400 probably cost Gateway 2000 half that amount. That
> kind of markup is normal, remember it includes a substantial markup
> for the dealer as well as the cost of doing bsuiness on an individual
> unit basis instead of a much more desirable OEM deal.
I don't believe that hefty margin turnaround for the OEM
is in the realm of reality.
Did you not mention a 50% margin figure? That I could
perhaps see (though it still seems a bit high). But the jump from
the OEM $800 price to the consumer price of just shy of $1800 is
a full 125% markup difference. That's simply unheard of. VERY few
industries have even *remotely* that kind of markup margin (though
the lingerie industry comes to mind. ;)
Anyone else with more knowledge in this area care to comment?
----- ____________________________
Randy Whittle whittle@usc.edu | Making South-Central |
USC Graduate School of Business (Fight on 'SC!)| L.A. a better place by |
-Counselor, USC Business Expansion Network | helping small businesses |
| help themselves. |
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