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Matching Dell Case Study

In: Business and Management

Submitted By sgt888
Words 430
Pages 2
1. Is the PC industry attractive in the mid to late 1990 ?
Strong Economy Growth, Emergence of New Services

Fierce Competition
(IBM, Compaq, HP Gateway) ,

2. Why do you think it become this way ? (1)
A. History B. Products
World Wide Web, E-mail, less than $ 1,000(‘97), 45.5% of household in the USA(’98), etc.

Declined PC prices (numerous global manufacturers) - Housing, keyboard, monitor, modem, etc. - Microprocessor (Intel, 80~90%) ☞ Sub-$1,000 market by AMD (50%) Soft Ware ⇒ Bundled PC - Operating system : Windows - Application s/w : office productivity applications
Large & midsize businesses, governments - MIS Dept. (highly knowledgeable staffs) Small business and offices - Lacked MIS staffs (reliability, performance, brand, etc.) Individual consumers - Independent org. such as Consumer Reports ※ Sensitive to price and brand name Educational institutions (3~6%)

C. Customers
U.S. PC Sales (’97)
32.7% 3.6% 39.8%

Large/Mid Small Home Education

24.0%

2. Why do you think it become this way ? (2)
D. Channel
Retailers (Circuit city, CompUSA 14.1% margin, etc) Distributors (Ingram Micro 5~7% margin) Integrated resellers (MicroAge, Vanstar) Direct distribution (telephone, Internet, shipper)

E. Manufacturing

Basic assembly-line techniques The Cost at $1,000 Components prices declined by 25~30% - Roughly 1% per week (‘98)
Apple, HP, IBM - 2~3% of sales on advertising - 25,000 sales staffs of IBM White-box PCs - No AD. & nonexistent sales forces ☞ North America 23%, Europe & Asia 50%, China 90%

F. Marketing

3. What were the key success factors for Dell’s success ? (1)
D/M and On-line Performance Metrics

Strong A/S

6 KSFs
High-Tec., Low Price
Customization JIT

3. What were the key success factors for Dell’s success ? (2)

A. Sales marketing

Direct order from customers Finer classification of buyers -...

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