where component costs account for 75 percent of revenues and typically fall by 1 percent per week due to rapid obsolescence. For example when larger faster hard drives are introduced which occurs every three to six months the value of previous generation hard drives is significantly reduced. So if Dell holds one week of inventory and a competitor holds four weeks this translates immediately into 3 percent worth of component cost advantage to Dell which can mean a 2 percent advantage on the bottom line Driving inventory out the system also dramatically reduces Dell is need for working capital and boosts the company is profitability.