Dell enterprise disk drive prices have soared by up to 35 per cent in the two weeks following the events in Thailand. Context data reveals average sales prices (ASPs) for Dell HDDs grew 6.9 per cent as of 31 October but hikes were more pronounced on larger capacity specs, with a 3 per cent rise on drives below 600GB and the …
"BTO model and minimal stocks to blame"
Yes and no.
BTO and minimal stocks would be OK, if there was resilience in the supply chain.
But somehow no one in authority seems to have noticed that the hard drive industry had somehow ended up with critical parts of the process all in the same [low cost labour] place, vulnerable to a geography-related incident, regardless of whose badge was on the eventual hard drive.
Anyone with a clue would have understood the value of dual (or multiple) sourcing in a case like this. Or even just the value of holding a bit of stock (on rotation) to keep high-value customers sweet(er) if there's a hiccup in the supply chain.
But big business doesn't have much of a clue these days. Not at the top anyway.
NOW you tell us it seems so blindingly obvious
You'd be surprised (or perhaps not) how many people don't see it.
Most of them have "director" or "manager" in their job title, and pay themselves a great deal.
But when Bad Things happen, the buck stops (and the bonuses stop, and the jobs are lost) elsewhere.
Funny thing is...
We USED to know this, before outsourcing and the race to the bottom. heck its why AMD exists in the first place as IBM and several others in the early days would not have ANY part in their machines that they didn't have a reliable second source for. Thanks to that if Intel goes nuts on prices one easy board change out and AMD chips are in its place, we have multiple sources for LCDs, RAM, but I have to wonder how much of that is likewise in danger of a single disaster in some third world country taking out the whole chain?
35%, not bad
The 1TB Samsung SpinPoint F3 drive I wanted from CCL rose from £44 to £106. It has dropped to £104 but still seems a worse deal than the Dell price.
People buy disks from Dell? I thought the secret was to go with the cheapest RAM and disk configuration possible, then load up on memory and disks from a supplier that isn't gouging you...
it's not our fault
we didn't oursource everything to a cheap labour third-world country. we tried, but we failed.
I thought the result of Dell's BTO system was that they were simply passing the risk to their suppliers ... i.e. suppliers have contracts with Dell to supply components virtually on demand as the BTO orders come in so they (the suppliers) need to ensure that they hold enough stock to act as a buffer between the delivery time Dell demands (think its in terms of hours rather than days) and the time it takes to get stock from manufacture. And another useful side effect of this for Dell is that Dell can point out to the suppliers that it would be useful if the suppliers had warehousing really close to the Dell manufacturing ... so why don't they rent some onsire warehousing space from Dell. I.e. when its all working Dell get the components as soon as they need them and the suppliers take the hit for managing stock and also pay Dell to rent on-site warehousing so that they can deliver on demand.
I expect, however, that a systemic breakdown in supply as appears to be the case at the moment breaks this model!
"passing the risk to their suppliers" (and the cost of holding stock, and...)
Major manufacturers in the UK automotive industry started forcing this business model (EDI, JIT, kanban, LEAN, etc) on their suppliers a decade or two ago.
Worked so well for them that there is now no UK-owned car industry to speak of, and what manufacturing remains is mostly foreign owned.
Good job we can still rely on trickle-down from the City boys to keep us constructively employed, eh?
Well, till folk realise that the banksters are insolvent, rather than having a short term liquidity problem which they can rely on the taxpayers to fix.
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