Slide on SWOT Analysis
STRENGTHS:
1. Direct to Customer Business Model
· One of the core elements in Dell’s rise to global prominence was its cost-efficient approach to build-to-order manufacturing. This allowed customers to purchase custom-built products and custom-tailored services, which was the most effective ways to meet customer needs.
· So, customers could order whatever configuration of microprocessor speed, random-access memory, hard disk capacity etc they preferred.
· Your order was directed to the nearest factory and Dell had assembly plants in Austin, Texas; Nashville, Tennessee; Limerick, Ireland; Xiamen, China; Penang, Malaysia and El Dorada do Sul, Brazil; largest plant was in Winston-Salem, North Carolina, headquarters in Round Rock, Texas.
· Dell had a commanding 33.9% share of PC sales in US in 1st nine months of 2005, comfortably ahead of rivals HP, Gateway and IBM. Dell appears to be a low-cost leader along the major players in the IT industry.
· The sell-direct and built to order strategy bypassed distributors and retail dealers eliminating the mark-ups of resellers and also building to order greatly reduced costs and risk associated with carrying large stocks of goods. Dell unlike competitors (HP/Compaq and IBM) using the traditional value chain model did not have to wait for resellers to clear out their own inventories before it could push new models into the marketplace.
· Equally important was that those customers who bought from Dell got the satisfaction of having their computers customised to their particular liking and pocketbook.
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