Dell distribution network
Dell Distribution Network
I. Direct sales model
Dell current distribution network is direct sales model, this online sale refer to the fact that Dell does not use the retails channel, but sells its personal computers (PCs) directly to customers through its website www.dell.com. Dell does not make sales through any integrators or resellers, nor does it utilize any channel service profit margins. Sales are made by the collaborative efforts of the Dell’s task force and by means of advertisement. Customers can log in to Dell website to order the product with their own customized configurations. This information will be processed by Dell’s customer database system to identify necessary components and then automatically send to corresponding suppliers. Hence, Dell suppliers are always prepared to accept Dell’s requirements and deliver components requests. This way the intermediary steps that may add time and cost are eliminated, and Dell is directly linked to its customers.
This direct sales model is also suitable with its main targeted customers large-volume buyers who expect good price and quality, convenience, fast service and tailored ordering. The direct approach allows Dell to build a relationship, which makes it quick and easy for customers to do business with Dell. First of all, this model helps them to eliminate the need of supporting a widespread network of wholesalers and retail dealers, benefiting them in several aspects. It allows them to avoid dealer mark ups. They need not have to invest high on inventory costs associated with the retail or wholesale channel and to face the competition for retail shelf space. It also nullifies the risk of obsolescence associated with every product in a rapidly changing technological market.
SWOT analysis of Dell current distribution network
(a.i.1) Strengths
(a.i.1.a) Without intermediary
(a.i.1.a.i) Reducing the role of the intermediary will enable Dell to gain high profit, as Dell doesn’t need
I. Direct sales model
Dell current distribution network is direct sales model, this online sale refer to the fact that Dell does not use the retails channel, but sells its personal computers (PCs) directly to customers through its website www.dell.com. Dell does not make sales through any integrators or resellers, nor does it utilize any channel service profit margins. Sales are made by the collaborative efforts of the Dell’s task force and by means of advertisement. Customers can log in to Dell website to order the product with their own customized configurations. This information will be processed by Dell’s customer database system to identify necessary components and then automatically send to corresponding suppliers. Hence, Dell suppliers are always prepared to accept Dell’s requirements and deliver components requests. This way the intermediary steps that may add time and cost are eliminated, and Dell is directly linked to its customers.
This direct sales model is also suitable with its main targeted customers large-volume buyers who expect good price and quality, convenience, fast service and tailored ordering. The direct approach allows Dell to build a relationship, which makes it quick and easy for customers to do business with Dell. First of all, this model helps them to eliminate the need of supporting a widespread network of wholesalers and retail dealers, benefiting them in several aspects. It allows them to avoid dealer mark ups. They need not have to invest high on inventory costs associated with the retail or wholesale channel and to face the competition for retail shelf space. It also nullifies the risk of obsolescence associated with every product in a rapidly changing technological market.
SWOT analysis of Dell current distribution network
(a.i.1) Strengths
(a.i.1.a) Without intermediary
(a.i.1.a.i) Reducing the role of the intermediary will enable Dell to gain high profit, as Dell doesn’t need