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[ The PC Guide | The PC Buyer's Guide | Understanding PC Sources, Vendors and Prices | The PC Industry, Vendors and The Market ]

Vendors and Inventory

As mentioned in the previous section, the rapid price drops and low margins in the PC industry mean that PC companies can't afford to keep significant inventories of components and systems if they are to remain profitable. This means that in many cases, companies don't stock the items they sell. Even when they try to keep items in stock, they generally have low stock levels, resulting in items going out of stock frequently, especially when they are in high demand.

The more honest companies will acknowledge this up front, and in many cases it is worth going to a vendor who can give you a better price because his inventory is kept low, rather than paying the inventory carrying costs of another company. If a reputable vendor says "I don't have it in stock but I can order it today and have it shipped out tomorrow" then that vendor is probably being honest with you. In some cases the item can be drop-shipped from the wholesaler or distributor so you get it as fast as if the vendor had it in stock: so-called "virtual warehousing", which is becoming increasingly popular today.

The problems occur when companies try to "have their cake and eat it too"--they don't want to carry inventory, but they want their customers to think they have inventory so they will get orders for items that are supposed to be in stock. Some companies will in fact blatantly lie about the stock status of many items. They will say the item is in stock and then order it after you have already given them your credit card number; then you end up waiting for the item to come to the company when you think it's already on its way to you.

Other unethical vendors make you wait even longer. They will take an order and not even order the item from their supplier until they have "accumulated" enough orders of that particular item. This is done so they can get better pricing from their suppliers on larger quantity orders, or to save on shipping costs. This behavior is unethical, but it is done far too frequently by the less scrupulous vendors.

Again, not all vendors do these things; better vendors do not engage in this sort of behavior. What all this means to you, the consumer, is that you must be doubly sure to find out at the time that you order anything, whether or not it is in fact in stock and if not, when it will be in stock. Don't let the vendors push you around. See this vendor selection section on stock levels and out-of-stock policy for more. And if you have trouble with a vendor that claims to have something in stock but turns out to be lying, see here for some ideas on dealing with it.

Next: Understanding PC Buying


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