Analysis of Dell Online

The PC industry has started to develop fast in the 80 's when IBM launched its first PC series and later on when numerous small companies entered the market. PC is a new product and companies had to create the demand to it from the scratch.

Dell Computer Corporation was founded in 1984 by Michael Dell. From the early 1990s until the mid-2000s, Dell was ranked as a PC market leader relying on their distinctive marketing pattern “Direct Model” which undertook direct communication with customers and provided customized products. Recently, the PC industry is facing inconceivable worldwide competition, and Dell is gradually losing their competitive advantages by using its direct model in critical business segments. The company is facing shrinkage of growth, increasing competition, declining quality of customer service, and limitation of expansion. These issues have an enormous impact on Dell’s position as a technological giant in the PC industry.

efficiently and profitably in its niche market. By the late 1980’s – early 1990’s, Dell noticed that its

• Competition : Apple with propriety architecture had 20% market share, Compac enters in ’82, Dell in ’84,

The Dell Computer Corporation was founded in 1984 by Michael Dell, who began the company by refurbishing IBM clones out of his dorm room for extra money. From the beginning and through the 1990’s, the company grew quickly and was very successful. Dell used a cost leadership strategy and focus on creating products that were already in the market place, but changed the timing of production and the method of distribution that was in place with the company’s competitors by assembling computers to order and selling directly to the customers. The company focused on creating value for customers and meeting their needs, but into the

Michael Dell was the founder member of the Dell Company back in the year 1984. Michael is one of the youngest known developers who have ever lived. He founded the company at the tender age of 19 while he was still a student at the University of Texas. Michael Dell’s journey of success started when he added features to personal computers that he obtained from local retailers. Michael therefore sold such computers that he had modified himself and after making profits he decided to expand his business by hiring more people to help him in the supplies. In 1985, to do the business on a permanent basis, he left school and began to manufacture his own computers and sold them with the aid of advertisement in publications of computers trade (Hunger, 2006).

Dell and Apple are American companies that participate in the industry of Electronic Computers, according to the SIC 3571. This industry is oriented to the manufacture of diverse kind of data processing systems. In 2001, the largest computer makers in the United States were Dell, Compaq, Hewlett-Packard and IBM. They produced about 40 percent of personal computers shipments in the world according to International Data Corporation (IDC). Dell is positioned as the bigger competitor, but in 2002, Hewlett-Packard acquired Compaq, challenging Dell’s leadership in this sector. (1)

Dell, a direct-sales pioneer, grew exponentially in the 1990s and emerged as the worldwide market leader in 2001. During 2001-2002 it was the most profitable among the market leaders. Compaq came up with a full range of PCs ranging between $1,000 and $10,000. Whereas, IBM, which at once had a market share of 30%, was at this time going through a dramatic restructuring to stop its market share and profits from deteriorating further. Whereas, HP maintained a comparatively smaller share in PC sales. Besides

The PC industry has seen many changes in the past decade, such that there was a time when Dell was considered as one of the beloved brands of the internet era and now due to competitive and consumer behavioural changes, sales is not as prominent as it once was.

In similar fashion, Dell has been gaining market share in the higher margin PC server market segment, which is closely tied to and compliments the corporate PC market. The PC server market has been dominated by Compaq, Hewlett-Packard and IBM, however Dell announced Q4 Fiscal 2000 results that were surprisingly strong in this product segment. For the quarter, Dell shipments were up 43 percent overall, more than four times the industry rate and at multiples of the industry in all product categories, customer segments and geographic markets. Shipments of Dell Power Edge servers increased 63 percent and Dell accounted for 30 percent of global server growth, expanding at more than three times the industry rate and adding two full points of market share (Dell Delivers, 2001). 3

The Managerial Economics of Dell Incorporated “Our business is about technology, yes. But it 's also about operations and customer relationships.” (Dell, n.d.). Dell Incorporated produces electronics products, including, but not limited to; laptop computers, desktop computers, audio equipment, monitors, and printers. Michael Dell dropped out of college in his freshman year in 1984 and founded his new computer business under the name of PC 's Limited with $1,000 and a vision for designing, manufacturing and selling technology. Within four years, the company was renamed Dell Computer Corporation and went public. Within this time, Dell raised its market capitalization from $1,000 to $85 million. In 1992, Dell debuted on the Fortune 500, which made Michael Dell the youngest CEO leading a Fortune 500 company. By 1999, Dell was ranked No. 1 in PCs in the United States, No. 1 worldwide in PCs for large and medium businesses, and No. 1 in worldwide workstation shipments. By the year 2000, dell.com had reached sales of $40 million per day and by 2001, Dell became the No. 1 computer systems provider worldwide. In 2006, Dell became the first in the industry to offer free product recycling for consumers worldwide. And in 2013, Michael Dell and the private equity firm, Silver Lake Partners, bought back Dell from public shareholders, becoming a private company once again. Between 1984 and 2013, Dell has designed, manufactured,

Dell started out having a first mover advantage that allowed them to generate high returns and large growth in itd sales due to a unit direct sales model. As the industry matured, other competitors entered the market and markets pulled back Dells performance suffered. Today, Dell is the IBM of 2000 as it’s a mature business with GDP type growth in a

Ten years back, where the majority of business transactions were conducted offline. Today, the trend of most of companies is to deal with its consumers through internet and not just using PCs, the customers are using different types of platforms such as mobile phones, tablets and other small mobile devices. Just imagine that all computer manufacturers are in along marathon has no end point, guess who is running alone in the front? Answers would be different but sure Dell is one of them. Its success came from a strategy which is missing with most of its competitors. Dell has effectively relied on its online selling strategy more than offline selling strategy. Actually, the core of Dell’s strengths is

Dell was established in 1984 and today ranks 44 among the Fortune 500 companies and is the world 's largest computer systems companies. Dell is the first organisation to start the concepts of selling personal computer systems directly to customers. The company designs, customizes products and services to end-user requirements.

Earlier Dell didn’t manufacture any of the parts on its own. It mainly dealt with assembling the right products. It provides IT solutions and services along with the recovery of the asset, financing, infrastructure consulting, support, system integration and training.