Dell Inc: Moving Beyond Direct Sales Model
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Case Details:
Case Code : BSTR280
Case Length : 26 Pages
Period : 2006-2008
Pub Date : 2008
Teaching Note :Not Available
Organization : Dell Inc.
Industry : Computers
Countries : Global
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This case study was compiled from published sources, and is intended to be used as a basis for class discussion. It is not intended to illustrate either effective or ineffective handling of a management situation. Nor is it a primary information source.
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Excerpts Contd...
A Smart Move?
Analysts in general appreciated Dell's new channel strategy as many of them had been saying for a long time that such a change was necessary for the company. IDC analysts Richard Shim said,
"For years they didn't have to (change) because they kept winning."...
Is Dell Taking a Big Risk?
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Some analysts felt that Dell was taking a big risk with its new channel strategy. They felt that the company might be diluting what it was good at. They noted that Dell was undergoing a change at the fundamental level and the change would be far-reaching, requiring the company to manage its inventories in a different way...
Initial Results
In the second quarter of 2007, Dell's market share fell further by 5 percent, while HP's share rose to 37 percent. According to iSuppli, in the third quarter, Dell continued to trail HP with PC shipments of 9.9 million as against HP's 13.1 million...
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Outlook
Dell was confident that the initiatives it had taken would lead to healthy growth and profitability in the long term. In addition to its new channel strategy, the company was banking on its more recent focus on product design and technology...
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Exhibits
Exhibit I: Dell's Key Financials
Exhibit II: Five Tenets of Dell's Direct Model
Exhibit III: Dell's Direct Model Poster
Exhibit IV: Dell Stock's Performance: March 2003-March 2008
Exhibit V: A Note on HP's Distribution Strategy
Exhibit VI: A Brief Note on the Global PC Market
Exhibit VII: Dell's Electronic Kiosks at Shopping Malls
Exhibit VIII: Dell's Retail Store at Dallas
Exhibit IX: What the VARs Wanted from Dell
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