The fall shopping challenge: Dell EPP vs. Costco

I just received the big C’s fall shopping special promo mailer. There’s something about getting anything from Costco in the mail that makes that 10-yard trek to the mailbox after work worth all the effort. If for some reason you don’t get this mailer, you can see all the fall promo items on teh inter-tubes. “Fall” into savings. Get it?

For some reason my eyes fell on a particular item in this offering – a Dell XPS computer bundle, including Word and PowerPoint. Now, it’s been almost four years since I bought my Dell Dimenson 8400 system through Costco.com. I’ve been very happy with it and I haven’t really kept up with Dell’s progress in marketing newer, better computing packages. I knew that the XPS line used to be the higher-end, gamer-friendly boxes. Now it seems it has entered more of a mainstream marketing target.

My employer offers discounts on Dell systems through the Employee Purchase Program. Last time after much research I opted for Costco because they had a better deal on the three-year warranty, plus the free customer assistance by phone. So I started to wonder if my computer tanked all of a sudden, which direction would I go now? Assuming I needed another new monitor (not likely) and I was looking to invest in another long-term PC system, which avenue would lead me toward a better deal on this exact package?

I ran the numbers using the Dell EPP web site and compared them to this coupon deal offered through Costco.com until August 31 (while supplies last, of course). Here’s what I found:

Immediately upon hitting the Dell EPP site, I’m greeted with an announcement that my savings will be “up to” 12%. Hmm … I seem to recall it used to be 15%. This does not bode well for the big D. Once I’m able to log in I get another message – this time it informs me that I can use the site for pricing, but I’ll need to call a toll-free number to place an order. Really? Call? So this site has become less useful in the last four years. Again with the disappointment.

So I’m looking for the XPS 420 with a 24″ monitor, a 2.4-gig processor, 4 gigs of DDR2 RAM, and a 500-gig hard drive. Plus Excel and PowerPoint. The 420 is the “lower” end of the XPS line. The Dell.com package I see first has the same base-level Q600 Intel Quad-Core processor that the Costco deal has, so I know I’m on the right track. Now I have to configure the system to match the Costco specs

But wait … first I have to figure out which protection plan I want, or if I want one at all. The Costco deal offers two years of in-home hardware service. The Dell site doesn’t give me a two-year option. I can stick with the base price and get one year, or pop for three years at an additional $200. For the purposes of this comparison, I’m going to take this upgrade. We’ll figure that in to the final tally. By the way, it also comes with three years of 24-7 phone support and 20 gigs per year of online data backup. Not bad.

After that, it’s time to configure.

• The exact processor Costco offers (8-meg level-2 cache, 1066MHz front-side bus, 2.4-gig Q6600 Quad-Core) is the one Dell gives as the basic option. Nice and easy. The highest-level processor upgrade will set you back another $1,115!
• Windows Vista Home Premim: included.
• 8 gigs of DDRAM: $48 more than the standard 3 gigs.
• 500-gig hard drive: $48 more than the standard 320-gig. I’m starting to see a trend, here. By the way, you can order up to a 2-terabyte drive for nearly $800.
• Double-layer DVD combo drive: included. The Blu Ray burner is $359 more.
• The 24″ display is included in the package. I’m actually surprised by this. I assumed I was about to get burned.
• The 128-meg Radeon card is included. I would definitely upgrade this if I was really going to buy from Dell EPP.
• 7.1 channel audio: included
• The “Sound Bar” speaker in the Costco system is just the one speaker that attaches to the bottom of the monitor. It handles the center channel on a surround system. The package comes with no additional speakers on either site. It costs an extra $10 to get the Bar from Dell.
• USB keyboard & 2-button USB mouse: included.
• 15 months of McAfee Security Center: included.
• Microsoft Office Home & Student: $86 more.

After all that, here’s the damage:

Build cost: $1,836
3% discount for choosing the 3-year protection plan: -$55.08
12% discount for EPP members: $213.71
Free shipping
FINAL COST: $1,567.21
COSTCO PRICE: $1,399

Costco also offers free shipping. Both places will charge sales tax. My savings for choosing Costco.com would be $168.21, or 10.7%. The big C wins again.