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Dell's Desktop Deals - HOW SO CHEAP??

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g0dM@n

g0dM@n

Inactive Moderator
​
Joined
Sep 27, 2003
Can anyone tell me HOW or WHY Dell's prices on desktops are so unbelievably cheap??

I do freelance computer work and assembly. I just CANNOT compete with the prices that Dell has been giving... in parts alone I would lose money!!!

Is anyone else also losing their minds b/c of this? I used to do a decent amount of business on the side (I am an I.T. professional as well now), and in parts alone I can't beat Dell's price... that's WITHOUT a profit I still can't even beat them... I hate it!!!

Is Dell having trouble with business or something? Take this deal for example that is on slickdeals today.

* Intel Pentium Dual-Core Processor E2160 (1.80GHz, 1MB L2 Cache)
* Genuine Windows XP Home Edition (or Vista Home Basic)
* Dell 19 inch Widescreen E198WFP Analog Flat Panel Monitor
* 1GB Dual Channel DDR2 SDRAM 667MHz - 2DIMMs
* 16X DVD+/-RW Drive
* 250GB Serial ATA Hard Drive (7200RPM) w/DataBurst Cache
* Intel Graphics Media Accelerator 3100
* Integrated 7.1 Channel Audio
* 1 Year Basic Limited Warranty and 1 Year NBD On-Site Service
* 10GB for 1 Year Online Data Backup by Dell DataSafe

All for $379 + tax and free shipping!!!

My price off the top of my head would be:

CPU - $71.99
Motherbooard - $50
Windows XP Home - $89.99
Dell 19 inch LCD - $160 if you find it on sale
1GB DDR2 2DIMMs - $25
DVD+/-RW Drive - $25
250GB SATA HDD - $65
Case/PSU - $60
Keyboard/Mouse - $20

Total: Approx. $567

I typically profit anywhere from $100-300 depending on the system. The total I estimated is WITHOUT PROFIT...
And on top of that Dell gives a standard 1 yr warranty!!

So can anyone explain what's going on here? Should I give up the freelance computer assembly b/c Dell somehow pulls this stuff out of their ***??

People come to me b/c they know I build rock-solid systems for my friends and family and many others come to me based on referrals. I feel stupid even giving a price anymore b/c it will ALWAYS be beat by Dell, by a fair margin.
 
cabose1227 said:
dell probobly uses used parts!!!!!!!!!!
Click to expand...

HAHAHA!!!

I know they get BULK, but it's truly unbelievable that they can sell for those prices AND PROFIT from it!!!

I mean... they HAVE to make at least $80, right? So figure the ENTIRE SYSTEM costs $300...

:mad::mad:
 
g0dM@n said:
HAHAHA!!!

I know they get BULK, but it's truly unbelievable that they can sell for those prices AND PROFIT from it!!!

I mean... they HAVE to make at least $80, right? So figure the ENTIRE SYSTEM costs $300...

:mad::mad:
Click to expand...

1. Not everyone buys from slickdeals.

2. There is a lot of $ in accessories and support.

3. Volume discounts when you are dell are probally more than you think.

4. Go google "supply chain", find out why dell is so good at it, and you can make $$$ too.
 
I know whats going on..... bill gate$ paid dell to take over the pc market so windows can rule the earth!!!!!!! He will also stop us from building cool pc's!!!!!!!!!
 
Volume discounts that dell gets on stuff it buys. Pretty much it is expected that much more people will buy pcs at low end.

I would not expect the highest quality or best performance.

Motherboard probably comes with via chipest. Saw one guy buying acer pc, similar to dells but for more, it had via chipest. Checked newegg and you can get board for $20 after rebate.
 
You charge to build people's machines?

I've always worked on the barter system. I tell them to put the money into the system to enjoy it more, and that they have a nice food dehydrator that they aren't using anymore. Plus I hate raking the lawn, and paying for my beer, or paying for my wife's salon bill & massages. Recently I got the employee rate at a Fed Ex/Kinkos, plus my wife got a new purse.

Business is good.
 
g0dM@n said:
Can anyone tell me HOW or WHY Dell's prices on desktops are so unbelievably cheap??

I do freelance computer work and assembly. I just CANNOT compete with the prices that Dell has been giving... in parts alone I would lose money!!!

Is anyone else also losing their minds b/c of this? I used to do a decent amount of business on the side (I am an I.T. professional as well now), and in parts alone I can't beat Dell's price... that's WITHOUT a profit I still can't even beat them... I hate it!!!

Is Dell having trouble with business or something? Take this deal for example that is on slickdeals today.

* Intel Pentium Dual-Core Processor E2160 (1.80GHz, 1MB L2 Cache)
* Genuine Windows XP Home Edition (or Vista Home Basic)
* Dell 19 inch Widescreen E198WFP Analog Flat Panel Monitor
* 1GB Dual Channel DDR2 SDRAM 667MHz - 2DIMMs
* 16X DVD+/-RW Drive
* 250GB Serial ATA Hard Drive (7200RPM) w/DataBurst Cache
* Intel Graphics Media Accelerator 3100
* Integrated 7.1 Channel Audio
* 1 Year Basic Limited Warranty and 1 Year NBD On-Site Service
* 10GB for 1 Year Online Data Backup by Dell DataSafe

All for $379 + tax and free shipping!!!

My price off the top of my head would be:

CPU - $71.99
Motherbooard - $50
Windows XP Home - $89.99
Dell 19 inch LCD - $160 if you find it on sale
1GB DDR2 2DIMMs - $25
DVD+/-RW Drive - $25
250GB SATA HDD - $65
Case/PSU - $60
Keyboard/Mouse - $20

Total: Approx. $567

I typically profit anywhere from $100-300 depending on the system. The total I estimated is WITHOUT PROFIT...
And on top of that Dell gives a standard 1 yr warranty!!

So can anyone explain what's going on here? Should I give up the freelance computer assembly b/c Dell somehow pulls this stuff out of their ***??

People come to me b/c they know I build rock-solid systems for my friends and family and many others come to me based on referrals. I feel stupid even giving a price anymore b/c it will ALWAYS be beat by Dell, by a fair margin.
Click to expand...


Now upgrade that system to one that you would use. You will find you can build it cheaper.

Plus, you have to consider something else.

All of the parts you listed probably come with a 3 year or even in the case of ram (a very common fail point) lifetime warranty. Not to mention a machine you build has an upgrade path. Most dell machines, if you buy one with a E2XXX series CPU, probably will not support a FSB1333 CPU. I do not know this for fact.. just supposition. I know i started building my own PCs when I went to upgrade a 700MHz celeron system and the max the motherboard supported was a 800MHz celeron, I also could not upgrade video, and was severely limited in the amount of ram I could add. (2 dimm slots limited to 256 per slot).


Also just an aside.. i know you can get 2 GB of RAM for less then you listed for a single GB.. .it was in Cyberdeals a couple weeks ago. 9 dollars a stick i think.

I always tell people that they can get a Dell for less, unless they want a PC that will last. Then I can build it better and probably cheaper. Plus they have my phone number when something goes wrong. (And I talk good ingrish two)
 
{PMS}fishy said:
1. Not everyone buys from slickdeals.

2. There is a lot of $ in accessories and support.

3. Volume discounts when you are dell are probally more than you think.

4. Go google "supply chain", find out why dell is so good at it, and you can make $$$ too.
Click to expand...

Good points.

cabose1227 said:
I know whats going on..... bill gate$ paid dell to take over the pc market so windows can rule the earth!!!!!!! He will also stop us from building cool pc's!!!!!!!!!
Click to expand...
LOL. :D

Captain Helghas said:
You charge to build people's machines?

I've always worked on the barter system. I tell them to put the money into the system to enjoy it more, and that they have a nice food dehydrator that they aren't using anymore. Plus I hate raking the lawn, and paying for my beer, or paying for my wife's salon bill & massages. Recently I got the employee rate at a Fed Ex/Kinkos, plus my wife got a new purse.

Business is good.
Click to expand...
Yes, I do charge for people's machines, but I also work on the barter system myself. :)

I charge b/c it's part of my profession and b/c it was the ONLY thing that kept me alive when I was in college and didn't have a job. I learned and made money helping people out. I used to charge only like $40 labor for a couple hrs of work diagnosing and fixing people's problems. They'd pay for the part and I'd make a few bucks... either that or they'd have to take it elsewhere and pay at LEAST $150 in profit to another company.

As for the barter system, my chiropractor and I do that for the most part. :) I don't have coverage anymore with health insurance, so we help each other out while he pops and adjusts my back. I go to him at LEAST once a month and used to go 2-4x a month in 2007. He calls me up all the time and emails me.
Neur0mancer said:
Now upgrade that system to one that you would use. You will find you can build it cheaper.

Plus, you have to consider something else.

All of the parts you listed probably come with a 3 year or even in the case of ram (a very common fail point) lifetime warranty. Not to mention a machine you build has an upgrade path. Most dell machines, if you buy one with a E2XXX series CPU, probably will not support a FSB1333 CPU. I do not know this for fact.. just supposition. I know i started building my own PCs when I went to upgrade a 700MHz celeron system and the max the motherboard supported was a 800MHz celeron, I also could not upgrade video, and was severely limited in the amount of ram I could add. (2 dimm slots limited to 256 per slot).


Also just an aside.. i know you can get 2 GB of RAM for less then you listed for a single GB.. .it was in Cyberdeals a couple weeks ago. 9 dollars a stick i think.

I always tell people that they can get a Dell for less, unless they want a PC that will last. Then I can build it better and probably cheaper. Plus they have my phone number when something goes wrong. (And I talk good ingrish two)
Click to expand...

All good points... the upgrade path is definitely a good point as I seemed to overlook that. I had thought of it, but come to think of it who knows if you can easily swap out the stock CPU in these cheap Dells and put in a quad-core chip, or 4gigs of quality, speedy ram... or if the board will even handle a beefy video card in the future... or if the case will handle the heat from a beefy video card.

THANKS TO EVERYONE for the posts... if I'm still to keep up this freelance business on the side, I'll need more fuel to make my sales. I do build for a lot of people that I don't know to begin with so it's not like I work free for anyone. I just need to know how to pitch my sales now that there's so much competition. My profit margin has greatly lessened though I'll tell ya that for sure.
 
Supply chain is the key. Also you're looking at end-user retail prices for retail items, I can guarantee you Dell doesn't buy retail anything.
 
funny you should post something like this. everyone in my department at work knows my PC is my hobby so my boss asks me the other day to price him out 3 basic systems for his kids. i started looking into it a little and your posted specs and what dell was offering was what i got into looking at.

sucks, but i told him to get some dell's :(

/edit: thinking about it i think they must get a big kickoff from the OS. to me, thats where it hurts. if you look at how often M$ is posting up free copys of vista or whatever, i bet dell can get 100 licenses for the price of a retail copy. plus they know most the time it's not going to be used with any other machine. i think thats the killer part though. is the OS.
 
ChinStrap said:
funny you should post something like this. everyone in my department at work knows my PC is my hobby so my boss asks me the other day to price him out 3 basic systems for his kids. i started looking into it a little and your posted specs and what dell was offering was what i got into looking at.

sucks, but i told him to get some dell's :(

/edit: thinking about it i think they must get a big kickoff from the OS. to me, thats where it hurts. if you look at how often M$ is posting up free copys of vista or whatever, i bet dell can get 100 licenses for the price of a retail copy. plus they know most the time it's not going to be used with any other machine. i think thats the killer part though. is the OS.
Click to expand...
Yes, the OS is definitely a definitive factor, although bulk is as well as their CHEAP parts.
 
I can and have build boxes for about the same price or less than Dell. How? I buy from factories or factory headquarters in Taiwan and China though a supplier who does this kind of thing for foreign companies. I have to make a minimum order of an undisclosed total (though I can say its much less than USD5000 converted) for all the parts I buy and he's making me a big exception because we have an undisclosed relationship. Usually his minimum strike price is very high, lets just say that a quarter of a million USD would be considered low end for him.

For those who know my setups, its how I ended up having so much storage. I placed an order and had to get 35 hard drives one time. I'm not allowed to sell any of it publicly, so I had use most of it and sell the rest by mouth to friends and family. So IMO, you should give up. Dell probably gets an even better deal than my supplier and you will never be able to beat those prices unless you develop much better business connections here in Asia. I don't know if it made it through through your corporate owned and whitewashed news networks there (does Apple now own any of the enws conglomerates?), but there was a big scandal a few years ago. One company (I think it was Samsung) got caught selling Apple flash memory for iPods much lower than they were selling it to anyone else. Those are the kind of deals you can force if you're Dell.
 
Under the 500 price point, you simply can't beat Dell due to the not only their low cost for parts, but also because they can afford to sell at a loss (large company) versus you, who can't suddenly build computers for -$20 for a month to promote yourself.
 
g0dM@n said:
I do freelance computer work and assembly. I just CANNOT compete...

* Intel Pentium Dual-Core Processor E2160 (1.80GHz, 1MB L2 Cache)
* Genuine Windows XP Home Edition (or Vista Home Basic)
* Dell 19 inch Widescreen E198WFP Analog Flat Panel Monitor
* 1GB Dual Channel DDR2 SDRAM 667MHz - 2DIMMs
* 16X DVD+/-RW Drive
* 250GB Serial ATA Hard Drive (7200RPM) w/DataBurst Cache
* Intel Graphics Media Accelerator 3100
* Integrated 7.1 Channel Audio
* 1 Year Basic Limited Warranty and 1 Year NBD On-Site Service
* 10GB for 1 Year Online Data Backup by Dell DataSafe

All for $379 + tax and free shipping!!!

My price off the top of my head would be:...
Click to expand...
Com'on, admit it. You have integrity. If you shopped around for junk parts to meet those specs you could do a lot better than $567..but could you sleep at night knowing your gullible customers were screwed?
 
when i applied for a summer job at best buy years ago, the interviewer told me that they make next to nothing off a computer sale...I think he said 10% but it might've been less. He said they train all of their employees to "upsell" software and accessories because that is where they get their profit.

I'd assume dell does the same thing...on top of getting subsidizing with preinstalled software and buying components in bulk. For you to compete, you'd need to cut out the middle man. Even if you buy from a discount place like newegg, you are still paying newegg their profit, and then you'd have to mark-up beyond that to get some profit, so you are already at a loss to dell. And when they have things at discount, they are still not selling at a loss, they are just dropping their profit margin to try and sell more.
 
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