🚀 go-pugleaf

X-Newsreader: ProNews/2 Version 1.01 ia007




X-Newsreader: ProNews/2 Version 1.01 ia007




On Wed, 2 Dec 1998 02:39:07, sdenbes1@san.rr.com (Steven C. Den Beste) 
wrote:

|>Or he could, if it is not already, declare that the quantity discount
|>has to depend *only* on the quantity ordered/sold, and *not* be
|>dependent on what or what quantity of competitors products are also
|>purchased/preloaded/shipped. eg the OEM will get a specific discount
|>for purchasing Windows 1000 copies of Windows irrespective of whether
|>he ships 1000 PCs each preloaded with Windows, or whether he sells
|>3000 PCs with Windows, OS/2 & Linux each being preloaded on 1000 of
|>them.
| 
|One problem with this idea is that it would give the big five PC vendors a
|massive advantage over smaller competitors. A company selling PCs in
|millions would pay a lower average cost per copy of windows than a company
|selling, say, 50,000 per accounting cycle

Pray tell how you came up with this theory?
 
|Another point: Your plan actually *encourages* the PC makers to concentrate
|on Windows. Take your last example, for instance. If instead of only buying
|1000 copies he bought all 3000 copies of windows and didn't bother with OS/2
|and Linux, he'd pay the lower 3000-copy price per unit instead of the higher
|1000-copy price per unit; and since the market has already demonstrated that
|there is plenty of demand for Windows-preloaded PCs, his sales don't suffer.
|His total manufacturing price is lower, but he doesn't have to lower his
|sales price; his profit margin is higher and his sales are the same, so his
|total profit is larger. He wins, Microsoft wins, Linux and OS/2 lose.

The difference in cost between 1,000 and 3,000 would be miniscule on the
order of a penny a copy or something like that.  It isn't like that the 
additional costs of selling 3000 copies over 1000 copies.  Most selling 
costs are the same no matter how many units are sold (especially when up
in wholesale quantities).  Non-variable costs related to the transaction
is pretty much relegated to filling out order slips, shipping orders, 
and billing through accounts payable.  The typical maximum cost for this
operation is about $10 to $15 per transaction (and averages much less 
with todays technology).    So you are talking about a penny to a penny 
and a half a per copy sales costs on a 1,000 units.  Allocate it instead
over 3,000 units and you have between 3 mils and 5 mils per copy.  At 
any rate it equates to a maximum price difference of about a penny a 
copy.   Hardly a motivation for a buyer to overbuy.

Aren't you glad you have an accountant here to send the manure back to 
the farm?

Bob O - Computing for fun
Usenet Honors: Steven Den Beste Killfile - 1998