Dells Strategy and E-Commerce

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Dell Company was started by Michael Dell in 1984. After its establishment, it has grown to be one of the industry leaders in the PC industry through its two core strategy: i.e. customer satisfaction and cost lowering strategy. The core idea that Michael Dell had when he started Dell at the age of 19 has not changed even though the company has changed into a billion dollar corporation. The strategic plan of Dell includes the feature of individualized products as well as direct sales to the end users thus lowering their retail costs. Dell's focus on the efficiency of manufacturing its products, and the approach of direct marketing, allowed him to establish a firm ground in the world of personal computers. In many cases, companies start out as aggressive but are left behind either by their competitors or by a poor and an unstable management. Dell entered the market with a very strong strategic mission and visions a powerful strategic management. One of the biggest advantages is that Dell has simple business concept which is building computers according to the customer’s needs and selling it directly to its customers. This simple strategy gives Dell an edge over its competitors on several competitive advantages. One of them is that, it bypasses retailers and distributors which eliminate the markup profit of the resellers and secondly, it helps Dell to avoid the inventory heavy inventory costs that are required to stick all the manufactured products. Dell believes that its model of e-business policy is applicable everywhere, anywhere and for any customer. Dell has witnessed remarkable success in a short period of time by choosing a strategy of direct business to customer form. Looking at its history, it began selling online in 1996, by 1999 it became the largest manufacturer of computers in industry, its name was changed to Dell Inc. in 2003, CEO Michael Dell resigned from his position in 2003 and again gained back his position in 2007. Therefore in 1992, Dell became successful in putting its name in the list Fortune 500 companies and establishing itself as one of the largest companies in the world. Later in 1993, due to substantial growth, Dell finally was able to place themselves in the top five PC manufacturers in the industry (Rock, 1999). In 2009 it acquired KACE Networks after which the company benefitted a lot from this acquisition. The low costs concept established by their partners with suppliers and wonderful use of just-in-time inventory help Dell to reduce the price, leading to the extraordinary successes of Dell This paper explains how Dell successfully launched itself successfully and the strategies like e-commerce, e- marketing they adopted along the road to put themselves ahead in the competition. There are many other competitors who have utilized similar type of strategy to reach to their customers. Dell's major competitors include Hewlett-Packard, Acer, Toshiba, Gateway, Sony, Lenovo, IBM, Samsung, and Apple. New entrants have not been a real threat to established company like Dell. Dell understands the significance of working with diverse suppliers is a must to the success of their company. As such, Dell has many competitive suppliers from around the world that provide them materials for the end product. E-commerce is fast becoming an outstanding way of doing business in today’s business environment. It integrates different elements that are similar to those of regular businesses but using a unique direct model. Dell’s e-business model is based on penetrating into computer industry, by allowing the choice on the customer end where personal computers are built after the order has been approved and processed through the internet. The two key advantages of e-business model are that the products are customized for customer and the cost of inventory is very less. Looking at the business approaches, Dell was one of the first companies to make e-commerce thorough internet as their weapon strategy to lead them ahead...
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