Dell's Value Chain

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Dell’s Value Chain

1. How has Dell used its direct sales and build-to-order model to develop an exceptional supply chain? Dell has used its direct sales and build-to-order model to develop an exceptional supply chain by taking customer feedback very seriously. Dell uses the feedback to further evaluate and when necessary, implement change to improve their supply chain. The company maintains close-knit relationships with customers, and maintains very close, professional relations with their suppliers. Dell collects a larger amount of customer information than is the industry norm. This also works to the company 's advantage. The close-knit relationships with customers that Dell maintains allow the company to determine what products
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The greatest advantage Dell experiences are the direct elimination of all retail and distribution costs for their products. Because Dell does not have to operate multiple locations, warehouses, etc, they can offer their products at lower prices, which attract even more consumers. Dell does not have the same high fixed expenses that their competitors have, who operate multiple factory locations. Dell also competes with retailers who already have a stock by doing just the opposite - not carrying a stock. When a consumer wants a particular model of computer, the retailer must have the item in stock. When a customer shops at Dell, the customer designs exactly what they want. A customer can design a very basic, bare-bones model, or a model that includes almost limitless options. The computer is then built in a matter of hours. The customer has his or her own, custom-designed system in a matter of a few days. There is no waiting for out-of-stock products, and Dell holds minimal inventory by utilizing such a well-designed system.
5. How does Dell 's supply chain deal with the bullwhip effect? The Bullwhip Effect in itself is a situation whereby the variation in orders is heightened as it gradually moves up the supply chain through a specific process. The process moves from consumer to distribution, and then moves to suppliers. To deal with the Bullwhip Effect, Dell is open with sharing knowledge with their

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