Compaq starts build-to-order PC business

Compaq Computer Corp. last week said it is embracing a build-to-order manufacturing model and announced the company's first PCs to be assembled using this approach.

Compaq which in the past has manufactured products on a built-to-forecast basis will extend the build-to-order approach to cover all product lines with a worldwide rollout to be under way by the fourth calendar quarter.

The company also has announced immediate availability of 13 new Deskpro 2000 and Deskpro 4000 PCs which will be built to order. At the same time Compaq lowered prices on desktop products across the board by as much as 22 percent a price cut that also applies to the General Services Administration schedule.

Industry analysts have been expecting Compaq to respond to the success of direct-selling build-to-order PC suppliers such as Dell Computer Corp. and Gateway 2000 Inc. "This is pretty clearly a response to Dell and Gateway 2000 " noted Payton Smith a research analyst at IDC Government Falls Church Va.

Gary Newgaard director of federal sales and marketing at Compaq said Compaq's new approach will "improve the delivery cycle dramatically" to the channel and end customers.

Compaq plans to work with its reseller channel to meet customer demand through two programs: Configure-to-Order and Channel Configuration. In the former program Compaq will provide "flexible configuration for a broad set of commonly requested combinations " the company said. The latter program involves Compaq providing configurable products to participating resellers.

Compaq last week applied to GSA to have its build-to-order Deskpro 2000s and Deskpro 4000s added to the GSA schedule. Newgaard said the new models also will be added to federal contracts currently carrying Deskpro 2000s and 4000s.

Compaq said its new build-to-order products are priced below comparable competing products. The company said its Deskpro 4000 Model 5200X/2400 equipped with a 200 MHz Pentium with MMX technology chip is priced 4 percent lower than a similarly configured Dell OptiPlex GXi.

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