Why is the inventory balance so small compared to the other current asset balances? What competitive advantage does Dell derive from its low inventory levels?
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Why is the inventory balance so small compared to the other current asset balances? What competitive advantage does Dell derive from its low inventory levels?
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I'll give you a few things to think about, but you should be able to expand on these:
Dell has a build-to-order philosophy.
They sell directly to consumers, leaving about middlemen and retail stores.
Think about obsolescence, storage costs, and any other cost you can associate with carrying a large inventory.
You need to think about what inventory is and inventory turnover.
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