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Lexon accused of misleading customers

Assembler says it's not doing anything different from anyone else

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UK PC assembler Lexon has hit back at accusations of damaging the market and selling PCs at less than cost price. Rivals and industry bodies alike have questioned the Croydon-based dealer's ability to sell such cheap kit. They also criticised Lexon's long delivery times. According to industry sources, Lexon has been winning reviews in magazines for selling high-spec, low cost machines. They claimed the company took orders but left customers waiting up to six weeks before their PC arrived. Lexon was this week accused of selling PCs at up to £375 below cost price in Microscope magazine. Lexon has won awards or been recommended in magazines including PCW, PC Plus, PC Direct, PC Buyer and Computer Buyer. For example, the Lexon Entra 333, Celeron 333 MHz, 64 MB SDRAM, was reviewed in PCW in February at £499 ex VAT. Rival system builder Evesham Micros said its would make about £25 margin selling this PC at £499, allowing for internal support and building costs. Price cuts in components would fall between orders and deliveries, sources claimed, making it possible for Lexon to advertise at low prices without sacrificing margin altogether. For example, Intel will cut Pentium II prices by around 10 per cent on 11 April. Luke Ireland, a director at Evesham Micros, said Lexon was damaging both the industry and customers alike. "I feel certain magazines are being misled by some smaller players. This is damaging the market in the long-term, and it's not good for the customers either," Ireland said. Lexon is certainly proving very popular. The Register sleuths found it nigh on impossible to get through to their sales department - with lines constantly busy. The report in Microscope quoted Lexon MD, Mohammed Mawji, saying: "It's utter nonsense to suggest we are selling at below cost." He claimed that delays in shipping orders were due to being "inundated with orders" and difficulty sourcing Intel Celeron 333 processors. John Banks, Lexon marketing manager, gave more detail, saying the six week lead time was only for one model - the Lexon Viper EL, with Celeron 333A chip. He said after Intel discontinued this chip for slot one, it was hard to source it. He added Lexon had now scrapped this model and lead times were between 10 and 14 working days for other machines. Banks said: "I don't think we're doing anything different to our competitors in the industry." He added: "I know our industry is fast moving, but I don't think prices drop in three weeks." ®

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