1. By: Jagjyot Singh Chadha Shaswati Sen Poulomi Sen Priya Khurana Chaitanya Bansal 2. Introduction <ul><li>Founded by: Michael Dell (CEO) in 1984…
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  • 1. By: Jagjyot Singh Chadha Shaswati Sen Poulomi Sen Priya Khurana Chaitanya Bansal
  • 2. Introduction <ul><li>Founded by: Michael Dell (CEO) in 1984 </li></ul><ul><li>Revenue $57.4 billion (2007) </li></ul><ul><li>Net income $2.6 billion (2007) </li></ul><ul><li>Employees 90400 </li></ul><ul><li>Operate in 34 countries. </li></ul><ul><li>Slogan: “Uniquely You” </li></ul>
  • 3. History <ul><li>Dell grew through the 1980 s and 1990 s to become at one stage the largest seller of PCs and servers. </li></ul><ul><li>In 1992 Dell first time enter into the Fortune 500 list. </li></ul><ul><li>In 1996 , Dell began selling computers via its web site. </li></ul><ul><li>In 1999 , Dell overtook Compaq, to become largest seller of personal computers in US. </li></ul><ul><li>In 2006 rank of Dell is 25 th in fortune 500. </li></ul><ul><li>It currently holds the second spot in the hardware computer industry behind Hewlett-Packard after the latter's merger with Compaq in 2002. </li></ul>
  • 4. E E
  • 5. Traditional Business Model <ul><li>Dell sold its product to End user customer /corporate customers. </li></ul><ul><li>Using direct sales model via Internet and Telephone network. </li></ul>
  • 6. Dell Online <ul><li>Started in 1996 </li></ul><ul><li>website </li></ul><ul><li>Dell online is a high success story – industry analyst </li></ul><ul><li>Millions of people visit the website each week and generate millions of dollars revenue. </li></ul><ul><li>Dell’s business model is to let the customer configure the product on the web and fulfill within 36 hours. </li></ul><ul><li>Customers can check the order status and also get the technical help online. </li></ul>
  • 8. DELL’s VALUE WEB MODEL Component Suppliers
  • 9. Component supplier <ul><li>The suppliers of high-tech components, such as microprocessors and software provided by firms such as Intel and Microsoft, </li></ul><ul><li>The low-tech, low-differentiation components manufacturers who compete on prices and availability. </li></ul>
  • 11. Original equipment Manufacturer(OEM) <ul><li>The OEMs traditionally would receive all the parts from their suppliers, assemble the computers in their production lines and ship them over to their distributors, or Corporate resellers. </li></ul><ul><li>e.g. Company ‘XYZ’ receive parts from Intel (processor), Microsoft (software) then this company assemble the computer to Santech computer. </li></ul>Supplier OEM
  • 12. DELL’s VALUE WEB MODEL Distributors
  • 13. Distributors <ul><li>They generally supply to corporate resellers and other distributors. </li></ul><ul><li>They carry large quantities of different products, to increase their leverage when dealing with their customers. </li></ul><ul><li>They also provide specific software, peripherals, furniture, etc, as well as service. </li></ul><ul><li>e.g. Ingram Micro, Tech Data, Computer 2000, and Santech . </li></ul>
  • 14. DELL’s VALUE WEB MODEL System integrators
  • 15. Corporate resellers/System Integrators <ul><li>The corporate resellers or systems integrators generally buy systems directly from manufacturers and install these systems at their corporate clients. </li></ul><ul><li>These are firms whose main purpose is to provide customization to their clients. </li></ul>integrate software, hardware, and network capabilities
  • 16. Manufacturer Manufacturer consumer commercial
  • 17. Particular Name of companies Component parts Intel(microprocessors), Sony(picture tube), Third party hardware and software supplier Microsoft Distributors Ingram Micro, Tech Data, Computer 2000, and Santech . Retailers Wal-Mart, Office Max, Computer City, CompUSA and Micro-Center System integration Wang, Unisys, and IBM Repair and Support companies Wang, Unisys, IBM and BancTec
  • 18. <ul><li>Dells model looks surprisingly simple. </li></ul><ul><li>Behind this simple model is the complex hard to imitate core capabilities developed over 15 years. </li></ul>
  • 19. Benefits to company by such distribution <ul><li>CASH: Dell maintains a negative cash conversion cycle means the payment receive for product before it has to pay for material. </li></ul><ul><li>COST: </li></ul><ul><li>Dell’s direct sales and build-to-order model has achieved superior performance in the PC industry in terms of inventory turnover, reduced overhead, cash conversion, and return on investment </li></ul><ul><li>Bypassing the reseller channel that causes further cost reduction to company. </li></ul>
  • 20. <ul><li>CRM: Direct customer relationship is the key to Dell’s business model, and provides distinct advantages over the indirect sales model. </li></ul><ul><li>DEMAND FORECAST : Dell additional advantages over indirect PC vendors who must try to forecast demand and ship products based on those forecasts. </li></ul>
  • 21. Benefits to customer by such distribution <ul><li>Tailored offerings from Dell in terms of add-on products and services. </li></ul><ul><li>Very customizable systems at an affordable rate, since Dell manufacturing builds specifically for each customer. </li></ul>
  • 22. Thank You
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