Matching Dell Essay

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able of Contents
Table of Contents 2
Step One – Financial Analysis 4
Step Two – External Business Environment Analysis 8
Concluding Identification of Current External Business Competitive Issues 11


The Matching Dell Business case by (Rivkin.J & Porter, M) defines the personal computer industry and outlines its history and development, with focus on Dell Computers.
This paper will analyze the case study by means of the Strategic Situation Analysis and Planning Method (SSAP), by portraying and comparing Dell with its main competitors, namely: IBM, Compaq, Hewllet-Packard and Gateway.
Approaching the strategic situation from SSAP method’s step number one, Financial Analysis, step number two, External Business
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Dell's market share increases from 1.0 in 1990 to 13.2 in 1998. Direct sales of Dell' personal computers through telephone, mail, and internet helped increase their market share. The total market size for the personal computer industry is $74.6 million. Exhibit 4: Portion of Sales Through Each Channel by Region from the Matching Dell Case shows the highest channels in which personal computers are distributed in different geographic areas. In the Americas, the most popular channel is distributor/reseller which accounts for 41.2% of sales, second is the direct channel which accounts for 29.7% of sales, and third is the retail channel which accounts for 21.7% of the sales. These three channels are the top channels world wide, and distributor/reseller is the channel with the highest percentage of sales across the board.

Income Statements
Dell and its competitors Compaq, Gateway, and HP all have had their revenues increase over the period between 1991 and 1998. The companies differ when the net income is compared from the same time period. In the Appendix, Table 4: Profit as a Percentage of Sales shows a comparison between 1991 and 1998. Profit as a percentage of sales is a note worthy calculation because it shows a ratio of profits to sales. If a company has high sales it does not necessarily mean that it will have high profits. In Table 4, you see that in 1998 Dell has the highest profit as a percentage of
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