Analysis of Dell in Macro Environment
Dell Inc (Dell) is a United State (US) based company that is engaged in developing, designing, marketing, manufacturing, and supporting information technology systems. The company offered product includes laptops, desktops, storage devices and printers, among several others. Geographically, the company has its operations in the Americas, Europe, the Middle East and Africa, and Asia Pacific-Japan. The company headquartered was located at Texas, the United States (Liebert, 2009). Dell delivers innovative technology and services where placed at number 34 on the fortune 500 list. Dell's climb to market leadership is the result of its sharp focus on delivering the best possible customer experience by directly selling, standards-based computing products and services. Dell's concept is understands customers needs and efficiently provides the most effective computing solutions to meet those needs (Shine, 2008). 2. The Macro Environment Analysis of the Company
2.1 PEST analysis
In the following, the analysis of the political, economic, social and technological factors leads to a description of the macro environment of the Dell computer industry. 2.1.1 Political
Political factors include government regulations and legal issues determining the conditions under which companies have to operate. Dell has to face certain restraints while do business. For example, corporate tax rate estimated by the country's Industrial Development Agency was 39.5% in the US (Mehra, 2008).The US government restrictive their policies often hinder foreign companies from entering into their markets. This is because the policy which is maintained is to protect the domestic industries and production (Scribd, 2009). Another regulation that should follow by Dell is Waste from Electrical and Electronic Equipment (WEEE) laws which place by US Congress. The WEEE aims to reduce waste from electrical and electronic equipment and to improve the environmental friendly (Oreskovic, 2010). In May 2009, Dell became the first major computer manufacturer to ban the export of certain electronic waste, including material or chemical composition, to developing countries as part on responsible electronics disposal. Where the government is ready for such practice of responsible recycling, Dell has been an advocate for producer responsibility in such legislation (Dell, 2010). 2.1.2 Economic
The economic environment refers to the nature and direction of the economy in which a firm competes or may compete (Scribd, 2009). Dell was the one of the three biggest PC firm after Hewlett-Packard (HP) and IBM. Price is an important factor and hence inflation or fluctuating currency rates in a country might adversely affect the industry and margins (Mehra, 2008). Real GDP (Gross Domestic Product) growth will provide insight into the health of the computer hardware industry. Spending on computer hardware in Dell is expected to grow to $2.5 trillion in 2010 (Oreskovic, 2010). The company reported revenue in 2010 rose 22% to $15.5 billion, versus Wall Street's estimate of $15.2 billion, and doing really well in the production and selling of personal computers (Dell, 2010). Besides, Dell reported net income in its fiscal second quarter ended July 2010 was up to $545 million, from $472 million in the year-ago period (Dell, 2010). This growth of economic usually is having an impact on the purchasing power of potential customers. 2.1.3 Social
The social segment is concerned with a society attitudes and cultural values (Scribd, 2009). Consumers demand for computers is dependent on the educational level in a country. In the past, the demand for laptop computers comprised only of businesspeople. Now, college student’s demand represents a considerable percentage of the total demand for laptop computers. Also children are getting familiar with the use of computers at a very young age (Mehra, 2008). To fulfill younger consumers, Dell likes to...
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