Well old Mike is working very hard to seem like he’s not scared shitless. Here his company is going down in flames and he’s spending the weekend at a Renaissance Faire. Trying to get in good with the Linux freaks I guess. But the question is, where does Dell go next? Mikey already has tried everything when it comes to cutting costs. He’s got a SWAT team that scours the globe looking for the shittiest parts at the cheapest price. Then he forces his suppliers to store their parts in warehouses in Round Rock, so that they carry the inventory on their books. Worse yet, he makes them put the inventory in warehouses that are owned by Dell — and he charges them friggin rent.
That’s right. Not only does this cheapskate squeeze his suppliers to the bone on price. And not only does he make them hold his inventory for him. But he also makes them pay him friggin rent. Small price to pay, I suppose, for the great honor and privilege of being able to sell parts to the great Michael Dell and his wondrous crap machine.
Gotta hand it to Mike, the guy knows how to squeeze a penny. Makes Wal-Mart look like goddamn Santa Claus. Half of Dell’s managers are former Wal-Mart dweebs who were hired to bring Wal-Mart’s brand of cheapo supplier-squeezing tactics to the world of computers. The other half are former management consultants from Bain. You know, those super innovative, creative MBA types. Riiight. No wonder they’re doing so well.
So what’s the way out for Dell now? Once you’ve won the race to the bottom, what happens when the runners-up finally get there too? How much lower can you go? Well, he could take a page from our playbook and learn how to strike some deals and find young labor on the Asian market. Win-win for both sides. We get low-cost machines. They get fifteen cents an hour.