![[H]ard|Forum](/styles/hardforum/xenforo/logo_dark.png){kind=logo}
Whats wrong with Alienware?
- Thread starter mc_P
- Start date
- Status
Well, they charge twice what it would cost to build the system yourself, with the exact same parts. I would laugh at someone who would pay $3000 for a system that would only cost $1500 to build. There's nothing wrong with the products they sell...just the price. It's like paying someone to wipe your own ass.
Vertigo Acid
2(-log[H+])4u
- Joined
- May 31, 2003
- Messages
- 12,410
I think the main problem that people have with them around here is their price/performance ratio, especially since we can build our own systems for much less that have much more.
grantunderland
n00b
- Joined
- Mar 23, 2004
- Messages
- 58
I don't wanna thread crap or anything, but if you expect them to build it for just as much as we do, then how exactly are they going to make money?
I'm sure there are good gamers out there who are just to afraid for whatever reasons to build their own computer, and that is where Alienware and a bunch of other companies step in and do it for them
I'm sure there are good gamers out there who are just to afraid for whatever reasons to build their own computer, and that is where Alienware and a bunch of other companies step in and do it for them
Vertigo Acid
2(-log[H+])4u
- Joined
- May 31, 2003
- Messages
- 12,410
Theres profit margins... and then there's rape! Besides, since they're so big they get the parts in bulk cheaper than individuals
Who said anything about not expecting them to make a profit? We aren't morons...thanks. Anyway, if your a hardcore gamer, in need of a system like an Alienware, but your too afriad to build one yourself, you should immediately give up a computer and buy a kiddie console. You certainly shouldn't be allowed to own a computer then. Building a computer is not hard at all...not one bit.
LegendKiller
Supreme [H]ardness
- Joined
- Jun 21, 2000
- Messages
- 4,267
Ahhh, the blindness of youth.
People have their own skills set. Some can take apart a car and not think it is difficult. Others can program extensive programs and not think it was difficult. Yet others can glean valuable information from financial statements, and not think it was difficult.
Just because somebody may think that building a computer is hard doesn't mean they shouldn't own one.
As far as Alienware. You also have to figure that they actually pay for their OS' *GASP*. Not to mention that they have to WARRANTY the computer. They have to distribute the computer, and they have to pay for people to support the computer.
All of this costs money people, thats why the charge more.
Go figure.
LK
yea but still, that much 3grand ... 3 freekin thousand USD??!! for a 3200xp??? how much do to pay your workers.. i built my 3200 for im going to say 1200 canadian.. if i where to go out and buy it form a store i could see speninding maybe 2500 canadian which is like 2100 US or something...Alienware is pure rip off they dont offer any thing 2 special just a really ugly case... any one who sells computers offer warrenty and text support for half the price they only optimize your system once and then when they send it out.. so if your a hardcore gammer who dont know jack about computer imgine you spend 3g'z on your system it works well for like 3 months but then starts running slow cause you have to re optimize your settings, all hardware works well just runs slow.. what you going to do??? exactly text support will laughf in your face, why becuase you got to send your system in to be re -optomized 200 bucks please ... ALIEN WARE= Waste of money
Alienware is much over rated. I recently priced out a computer I had built for 700 dollars (Athlon 2800+, 512mb, etc), and put the exact same specs into Alienware's custom thing, and they would have charged $1500 for the same system. That's MORE than double.
If you like Alienware, then cool. Go buy your Alienware. The rest of us will sit around wondering what to do with the 800 dollars (or more) we saved by building it ourselves.
If you like Alienware, then cool. Go buy your Alienware. The rest of us will sit around wondering what to do with the 800 dollars (or more) we saved by building it ourselves.
LegendKiller
Supreme [H]ardness
- Joined
- Jun 21, 2000
- Messages
- 4,267
Again, my question is, did that include OS price?
Did that include 3 years of warranty?
Did that include labor costs?
Did that include ALL software they include?
You guys sit there pricing computers according to what YOU would build, including questionable software, OEM NO WARRANTY parts, no labor, shipping, corporate taxes, or ANYTHING else.
Quit being so f'ing narrow minded. You think you know what a computer should be priced at. All you know is your little world, nothing beyond it.
Grow up.
LK
Did that include 3 years of warranty?
Did that include labor costs?
Did that include ALL software they include?
You guys sit there pricing computers according to what YOU would build, including questionable software, OEM NO WARRANTY parts, no labor, shipping, corporate taxes, or ANYTHING else.
Quit being so f'ing narrow minded. You think you know what a computer should be priced at. All you know is your little world, nothing beyond it.
Grow up.
LK
first of all, alien ware, is no doubt a good company im not saying there product does not meet the bar, but they just charge way way 2 much 2 fully build optimize and install all software.. i dont care who you are should only take 5 hours that includes test time, alien ware is not OCed so they dont really worry about temps, second shipping is not included, and you get basic software just like your burning software you get when you buy a burner.. im not slapping them around for their product its cool, good performace but way over charged, they just takeing advantage of gamers who want the performace but dont have the know how, thats just wrong .... the onlything is lets say i went to best buy and pulled a computer with stats of 2ghz 1g ram 160gb hd and a top of the line video card.. this is "best buy", you still get your software, warrenty, etc im going to say this system will cost me 1250 just the system, no monitor.. now build it on alien ware 2200 come on...... your really paying some one 950 bucks for optimization.. come on how can you do that to some one, just taking advantage, and the only reason people buy from them is because they have big PC mag's testing there product rewview its performace, which is good, but they never tell you about the price, let alienware send a computer to get OCP'ed... Pros will be its performace is good, cons and this will be a big one Price.. overcharge like a g
CallMeIshmael
Limp Gawd
- Joined
- Aug 20, 2003
- Messages
- 174
Also consider this isn't some quick throw-together like a Dell box or cow spots. The high-end custom jobs take significant time to assemble, configure and burn in. How much per hour does your time bill for (including overhead, payroll taxes, etc)? Mine goes as high as $100/hour. At that rate, it doesn't take long to make a very expensive job. Add in warranty, tech support and the other odds and ends mentioned above, and their prices, while still high, aren't totally outrageous. As for "anyone who can't build one shouldn't have one", did you build your own car? Television? Stereo?
MooCow
[H]F Junkie
- Joined
- Apr 13, 2000
- Messages
- 8,217
Putting a computer together is much easier than car work, extensive programming, and "accounting".
I have over the years built many systems (4 Personal 8 Friends/Family) with excellent results, I have also purchased 2 Dells. Sometimes it's easier to order one ready to roll than screw around with ordering parts, shipping, the occasional RMA etc.. I enjoyed building the systems that I did, I also have no problem purchasing one if it's convienent. What I don't understand is why everyone cares so much about if it's a Dell/Gateway/Alienware or homebuilt ?
As to the quality issue I know;
3 People With Alienware's - They Love them
7 People with Dell's - They Love them
1 Person with a Falcon North West - Love's it
3 People with Store Brand generic PC's - They Love Them
12 People with Home Built - They Love them
conclusion.. as long as the qualities there.. who care's ??
As to the quality issue I know;
3 People With Alienware's - They Love them
7 People with Dell's - They Love them
1 Person with a Falcon North West - Love's it
3 People with Store Brand generic PC's - They Love Them
12 People with Home Built - They Love them
conclusion.. as long as the qualities there.. who care's ??
Chris_Morley
Former [H] Consumer Managing Ed.
- Joined
- Jul 5, 2000
- Messages
- 3,609
Having worked at 2 systems integrators (PCFX and BOXX Technologies), I can tell you that NO ONE makes the profit margins you're claiming.
I had to FIGHT to keep up with Alienware's pricing, and before I left PCFX I was barely clearing 18% BEFORE credit card charges.
18%!!! 33% is what you'd learn in business school as an acceptable level of margin. Car manufacturers make in the magnitude of 50% profit or more.
What's unique about this industry is that you people have a pretty good idea of the cost of goods sold (COGS). I had A level rates at my suppliers at PCFX and I was barely getting prices better than NewEgg. I had to order a palet from Lite-On of cases and optical drives to really get a better deal than the same set up at NewEgg.
I had to FIGHT to keep up with Alienware's pricing, and before I left PCFX I was barely clearing 18% BEFORE credit card charges.
18%!!! 33% is what you'd learn in business school as an acceptable level of margin. Car manufacturers make in the magnitude of 50% profit or more.
What's unique about this industry is that you people have a pretty good idea of the cost of goods sold (COGS). I had A level rates at my suppliers at PCFX and I was barely getting prices better than NewEgg. I had to order a palet from Lite-On of cases and optical drives to really get a better deal than the same set up at NewEgg.
Captain Rehab
Limp Gawd
- Joined
- Feb 29, 2004
- Messages
- 279
Anybody dislexic here? Imagine trying to RTFM if the words look like ants moving on a page. My mom couldn't build a computer if you put a gun to her head and offered her a million billion dollars. Really. Some people just can't do it. It's not their bad - lay off. If they want to spend the dough, let 'em.
Also, if AW wants to charge eleventy-million dollars for a box, I say good. If the market will bear it, they should charge it. Profit is the reason tech flourishes. Profit is the reason anything happens. Give people the opportunity to make a good profit and they will assume the risks. Everybody else just stay out of the way.
Also, if AW wants to charge eleventy-million dollars for a box, I say good. If the market will bear it, they should charge it. Profit is the reason tech flourishes. Profit is the reason anything happens. Give people the opportunity to make a good profit and they will assume the risks. Everybody else just stay out of the way.
So then she goes and buys a Dell, HP, Compaq, etc. Something that's actually priced reasonably. We aren't talking about all prebuilts here....we are talking about Alienware. Stay on topic.
Second....Alienware has a HUGE profit margin. Morley, I think you were buying your parts from the wrong place, or not negotiating the right deals. We had a speaker from Alienware during on of my business electives at Drexel....and he said they made huge profits on each machine. The gist was the demand was high enough, they could raise their prices extremely high and still sell.
Chris_Morley
Former [H] Consumer Managing Ed.
- Joined
- Jul 5, 2000
- Messages
- 3,609
Actually, I had very good suppliers. But I know what lots of 10,000 cost, and even though I wasn't ordering that magnatude, I at least know what the basement price was. 2 years of pitting suppliers against each other, and going through about a dozen, I was getting VERY good deals compared to other 'Tier 3' manufacturers that I had relationships with.
Now, that's before manufacturer's incentives...MS's partner programs, as well as rebates from intel.
A few years years ago Alienware was doing about 2500 machines a month. I estimate their profit margin to be at least 28%, but no where near 50%.
What Alienware will tell you and reality are probably not in the same ballpark. Now, Alienware probably has huge margin dollars due to the fact that their systems start much higher than any other integrator.
As per Dell's being reasonably price...their workstations are easy to beat on price, and at a higher margin. (Serious dual proc stuff, not basement-feeding price-competitive machines)
LegendKiller
Supreme [H]ardness
- Joined
- Jun 21, 2000
- Messages
- 4,267
How do you F'ing know they have a "huge profit margin"?
HOW DO YOU KNOW?
I work in the finance industry and I know where to get financial statements. However, Alienware is privately owned and does not release the statements. So you CANNOT know how much they make.
You people are so damn blind.
1. They have to pay their people. These aren't monkeys, they are probably making 40-50 with ALL BENEFITS and such.
2. They have to pay overhead, plant costs, admin costs, machinary, advertising, marketing, public relations.
3. They have to pay property taxes, corporate taxes, state taxes, federal taxes, city taxes.
4. They have to pay for lawyers.
5. They have to pay for costs of goods.
6. They actually have to pay for their software.
7. They have to pay for systems support, warranty replacement.
8. They have to pay for distribution.
Your narrow minded viewpoint of the world is quite pathetic.
Think of it another way. Bestbuy is supposed to be a cheap place to sell computers. However, Alienware couldn't even make it there, their profit margins fell through the floor, or else they'd still be there. So, obviously, they didn't cut it.
As far as auto manufacturers making 50%, that might be gross profit, but it certainly isn't operating or Net Income, or even EBIT. Might be EBITDA, but that is unlikely.
Their per car costs just for pension goes into the thousands.
Economics also dictates that if they were making such a huge profit on these machines, as you people claim, then there would be more companies like them selling these computers. Guess what, there aren't.
LK
LegendKiller....you need to calm the F down and learn to read. What I was telling you was right from the mouth of one of their finance people. Calling us narrow-minded, and then spouting Captain Obvious-like bullshit at us isn't adding anything to the conversation.
And if you'd like some common sense into business, the reason their aren't many companies like Alienware is because it costs a fortune to start out, takes a long time until you become profitable, and takes a long time to build a name. No where did any of us say Alienware sold a lot of PCs. All we said was that their profit margin is huge.
As they say in the NBA....reading is FUNdamental. Try it.
And if you'd like some common sense into business, the reason their aren't many companies like Alienware is because it costs a fortune to start out, takes a long time until you become profitable, and takes a long time to build a name. No where did any of us say Alienware sold a lot of PCs. All we said was that their profit margin is huge.
As they say in the NBA....reading is FUNdamental. Try it.
And all Legend said was that you're just assuming their profit margin is huge, when you have no idea how their business works, or what costs they have to cover. You reply to this with the same old predictable "stfu and read assclown" reply one would expect an elitist high schooler to come up with, while not supporting your argument in the least. There's a difference between debating and arguing for the sake of being ignorant, one that I don't think you've quite grasped.
Yes, computer building is very easy retrospectively. But you can't say that anybody can do it unless you have never - not once - asked a question pertaining to hardware. Nobody has, so maybe you should fucking remember what it was like to learn something new and stop being such elitists. This is why people generally dislike nerds.
Yes, computer building is very easy retrospectively. But you can't say that anybody can do it unless you have never - not once - asked a question pertaining to hardware. Nobody has, so maybe you should fucking remember what it was like to learn something new and stop being such elitists. This is why people generally dislike nerds.
Okay..one more time for the morons. It was a lecture given by one of their finance employees, with facts and figures, to prove that as long as there is a demand, you can pretty much set the prices. Read my earlier posts. Jesus Christ do you want me to right it in crayon and scan it in????
No, I want you to link me to this alleged lecture - complete with facts and figures - that would seemingly be pretty bad publicity, since it would be somebody from their company admitting poor business practices. I personally haven't seen or heard anything of this lecture, but I'll give you the benefit of the doubt and assume you're not talking out of your ass.
If you want to write the key quotes in crayon to better illustrate your point, please do. But I still want the link.
This is the part where you say, "It's from a long time ago, nobody has it still. But I remember it, you're just a noob, that's why you don't."
If you want to write the key quotes in crayon to better illustrate your point, please do. But I still want the link.
This is the part where you say, "It's from a long time ago, nobody has it still. But I remember it, you're just a noob, that's why you don't."
It was a college lecture...how the fuck am I supposed to link to that. And no I didn't take notes...it was an elective. He was a close personal friend of the professor, both of whom worked together during their day jobs on some joint projects. My professor was an independent IT consultant. You haven't seen or heard anything about the lecture because your weren't a Drexel student and you weren't in my class, dipshit. Am I typing in English here? Just checking.
CallMeIshmael
Limp Gawd
- Joined
- Aug 20, 2003
- Messages
- 174
Since when is it bad business practice to maximize profit margin on a premium product with a relative low demand?
LegendKiller
Supreme [H]ardness
- Joined
- Jun 21, 2000
- Messages
- 4,267
ROFL,
Where was this finance person located? What was his title? Where was the lecture?
I'd love to see where the hell a finance person from ANY company would sit there and tell you what their profit margin is when it is a PRIVATE company. That is sheer stupidity.
Furthermore, what was the lecture on?
barriers to entry in the computer market aren't huge. There aren't massive amounts of capital that need to be put forward, especially when you have internet distro.
Also, if this was so lucrative, then Dell would have gotten into the arena MUCH sooner than the XPS Gaming station.
As far as Captain Obvious stuff, sometimes people need to be started at square 1.
LK
LegendKiller
Supreme [H]ardness
- Joined
- Jun 21, 2000
- Messages
- 4,267
Maximizing profit margin on a PRODUCT does not = maximizing profit margin for a COMPANY.
LK
LegendKiller
Supreme [H]ardness
- Joined
- Jun 21, 2000
- Messages
- 4,267
Again, where was this finance person located?
LK
LegendKiller
Supreme [H]ardness
- Joined
- Jun 21, 2000
- Messages
- 4,267
Supply controls pricing also foolio, so half of your equation doesn't even fit, sounds like somebody's makin crap up. There are plenty of fish in the sea when buying one of these types of systems, which reduces profit.
LK
WTF do you want, his home address and penis size? He was in town to work on a project with my professor...and the professor asked him to give a quick talk on demand and pricing. I didn't interview him and ask him for a resume. I listened to what he had to say, decided I'd never buy an Alienware, and then I went home.
I can't believe someone with your level of foolishness and stupidty can even exist in today's world. You sir are beyond even simple conversations. I'm sorry I can't dumb it down enough for you. And yes, demand has an equal part in pricing. People like you make me want to cancel my internet service and stay at a fucking wall, because atleast I won't get drawn into conversations with idiots.
I am not reading over the entire thread but if you take AW's high end systems, they arn't that overpriced compared to a home built machine. You can't look at AW's mid range or 'low' end machines as a compasison as you dont go to alien ware for a low end machine.
But there High end systems are not outragiously priced. AW doesnt market there low end systems much at all.
But there High end systems are not outragiously priced. AW doesnt market there low end systems much at all.
LegendKiller
Supreme [H]ardness
- Joined
- Jun 21, 2000
- Messages
- 4,267
\
And I can't believe somebody as stupid as you exists to go to our national education system to come out and spread FUD about shit you have NO GODDAMN CLUE about.
You probably dont evne know the difference between EBIT and EBITDA and what they stand for. Your some stupid dumbass kid sitting around who looks at a number and decides, on his own, that a 30% gross margin is too much.
However, you lack the fucking business sense to realize that gross margin doesn't mean shit in the real world.
I highly doubt that a guy from a PRIVATE company based out of Miami is going to go to PA to give a lecture divulging financial information to a bunch of half-wit kids. Furthermore, even if he did do this, it is obvious your too fucking stupid to interpret it correctly. NO COMPANY makes more than the market rate for a machine. It is simply impossible in an industry that has so many fast moving competitors.
You sir, have failed to learn shit in school. Go back, get yourself a masters degree and a CFA and then come back to me saying I dont know anything.
Until then, fuck off.
LK
Why in the hell would I want any kind of finance degree? Sorry....not going to happen. I'll enjoy my IT degree from the top ranked school in the country for IT. You seems a little testy...
Were you the guy on the news who realized his GF was really a man? I'm sorry...that must be embarassing.
Wait...let me put up some acronyms you don't know, to make myself feel like a man.
Hey...asshat...I said he was a friend and business partner of my professor...that's why he was in PA at the time. We had guest speakers in plenty of my classes. I really feel sorry for people like you....honestly.
Cardboard Hammer
2[H]4U
- Joined
- Feb 20, 2001
- Messages
- 2,384
If you sell based on a name, you don't have to worry as much about being competed against on the basis of product. Take clothing, for example. Designer label clothing may be somewhat better quality in some cases, but status associated with the label itself has the bigger impact on the selling price.
Chris_Morley
Former [H] Consumer Managing Ed.
- Joined
- Jul 5, 2000
- Messages
- 3,609
C'mon guys, no need to get personal. I'm more than willing to discuss my humble insight into the world of PC gaming integrators...don't get this thread locked...
- Status