Dell Company and Product Analysis - Case Study Example

DELL COMPANY By Student’s name Coursecode+name Professor’sname Universityname City, State Date of submission Table of Contents Table of Contents 2 Part A 3 Dell Company and Product/Service Analysis 3 Market trends 4 Overseas Export Markets 4 SWOT Analysis 6 Strengths 6 Weaknesses 6 Opportunities 7 Threats 7 Part B 8 Global Market Search 8 The demand for PCs and PC-related services and products has registered a noticeable increase in East Africa owing to the ongoing process of computerization that is sailing through most African countries now. As observed, Dell is likely to succeed doing business in Kenya than Uganda or Tanzania, because of its market based economy and relaxed external trade system. Moreover, there is a high level of computer literacy, particularly among the youth. Kenya’s government is generally thought of as investment friendly and to simplify both local and foreign investment, it has enacted a number of regulatory reforms. Lastly, Kenya has a well-developed physical and social infrastructure. 10 Conclusion 10 Reference List 11 Part A Dell Company and Product/Service Analysis Dell Computer Company is one of the leading and top growing computer companies in the globe. Dell makes export compliance its first priority and closely sticks to all applicable export regulations imposed by The United States Bureau of Industry and Security. Dell’s Direct Model, which is mainly responsible for the achievements of the company, offers a fast, cost effective, and customer friendly ways of manufacture and distribution. Currently, in a market that is constantly changing, the rivals are challenging Dell with latest and unique products in an attempt to overcome the dominance of the Direct Model (Dell & Fredman 2000). The growth and development of PC’s is a prime area in which Dell is able to work for constant success, in spite of the threats that its competitors are posing. The corporation markets particular brand names to diverse consumer segments. It characteristically sells the Optiplex, Precision and Latitude names to middle and large business customers, where the advertising weight of the company is put on long life cycle, serviceability and reliability (Pealson & Yeh 1999). The Inspiron, Dimension and XPS brands have an orientation towards students, consumer and small home-office environments, emphasizing performance, value and expandability. Dell directly reintroduced the Dell XPS to target the profitable gaming market. Dell XPS desktop systems make use of blue rather than the black cases seen on newer Dell PCs. However, since the components of Dell computers are similar to other PC manufacturers, Dell needs to build the current customer base and maintain a strong customer loyalty (Wang, Li, Duan, Yan, Li, & Yang 2007). Market trends The market for PC’s has distinguished itself as one of the quickest growing sections of computer industry. All through its growth, this market, like many others, has altered very much because of customer demands (Kotler & Lee 2004). In an attempt to cater to these needs, Dell looks at market trends to assist in developing new products. In its initial stages, the laptop market has been particularly influenced by numerous trends. In general, the overall market for laptops is being affected by many of these trends. However, one particular trend is influencing the market more than the others are; that is, customers are becoming more educated in relation to their purchases (Mackenzie 2012). Overseas Export Markets Dell has recently set up a new distributorship deal in the East African market, especially Kenya, due to its prospects about the potential in this market. With the accelerating embracing of ICT in East Africa, Steve Mackenzie, the corporation’s regional manager for East Africa, states that Dell's entry will provide the market with a variety of choice and improve the quality of products in the sector (Dell & Fredman 2000). The firm announced the assignment of a new distribution associate, and distributorship model for its new-fangled line of products, which Dynatec Limited formerly distributed. Inspiron Technology, the latest Dell Master Distributor within East Africa hopes to support the computer market of makers share, as well as improve market access for its new line of goods. Inspiron Technology will facilitate Dell in providing better market coverage within the region as well as raise customer choice in buying Dell products from entry-level notebooks and desktops for the mini office through to wholly configured Data centre servers and storage for corporate and government branches. Dell imports to Africa the same advantages that it offers its customers internationally; advanced technology at competitive values (Schmid, Behrend, Kelber, & Krasel 2006). Dell has been operating in Africa for ten years, but it is merely in the previous five years that it appeared a serious player. Its major growth is seen in South Africa, which comprises of up to forty per cent of its entire Africa revenue base, regardless of a fifty percent annual growth in merged Africa markets. The company unveiled feature-laden notebooks for wireless computing solutions, desktops, precision workstations, networking power connect switches, power Edge servers, printers and a mass of software solutions (Holzner 2005). The computer and software product markets in Kenya are dominated by Hewlett Packard, then Dell, Fujitsu Siemens, Acer and IBM. By trading systems directly to consumers, they are better placed to recognize their needs. Dell also has the option to buy monitors, printers and other peripheral devices, as well as a service contract that differ not only in the contract’s length of time, but also in the level client’s of service. The technical support offered can be conducted only by phone or it can be executed in the form of a service-call guided by a qualified technician at the locality where the computer has been set up. Dell collects information from consumers via organized events and buyer panels, which is then employed in research and development. Dell has partnerships with a wide variety of hardware, software, and components vendors (Holzner 2005). SWOT Analysis Strengths Clearly, many of Dell’s strengths come because of the Direct Model. The model itself could be regarded one of the greatest assets of the company. Firstly, the Direct Model permits consumers to customize their PC’s fully. The market has become more knowledgeable, and individuals need a product that can fulfil their specific requirements. In the case of PC’s, this means that consumers want more choices in terms of portability and performance. By removing the retailer as a distributor, Dell has enabled buyers to order directly from the company, hence giving them the chance to customize their products fully (Mackenzie 2012). Additionally, the Direct Model yield relatively quick delivery. This allows clientele to place their orders, and obtain their customized computer usually within days. Another great strength of Dell has established relationships with big companies, which pass their relationship on through employees, offering them Dell products (Shirani 2012). Weaknesses Dell has a significant weakness in targeting college students section of the market. This is because only five percent of Dell’s total revenue currently comes from educational institutions such as colleges. Unlike its business customers, Dell lacks a large amount of relationships with learning institutions, and as many students buy their laptops through their school programs, thus Dell cannot take advantage of this market opportunity (Kraemer, Dedrick, & Yamashiro 2000). In terms of home-user, Dells greatest weakness is that customers cannot physically see or touch the product that they intend to purchase. While the Dell Direct Model offers many diverse great opportunities, its greatest disadvantage is that consumers cannot go to retail shops, try a few different products and walk home with a computer all in one trip (Dell & Fredman 2006). The very thing that distinguishes Dell from its rivals is customisation, which creates a problem in that a customer cannot go out to buy a Dell because they can order some other brand. Many people who purchase computers are wary of a product that they cannot personally examine prior to buying. Furthermore, anxious clients would have to wait a number of days before their computer could be delivered (Ignatiuk 2009). Opportunities Personal computers are being bought and largely used before. The laptops market is growing at a faster rate as compared to desktops. This general trend is as a great chance for Dell’s laptop business to flourish in all sections. Another great chance for every targeted markets pertains to the first trend mentioned. Customers are becoming more educated concerning computers, as a rising number of them are regular customers. Consumers who have bought computers in the past know what they want and Dell can supply to them. The Direct Model can offer the framework for consumers to make truly personalised computers in a relatively comfortable environment. This trend towards more educated consumers offers a great chance in this respect (Worland 2001). Threats In such an unpredictable market as PC’s, threats are many. Because of the ever-changing character of the computer industry, corporations are constantly undergoing challenges to produce high quality and low-priced products. One of the key outside threats to Dell is that the value difference among brands is getting smaller all the time. Dell’s Direct Model benefits the customer in many ways, one of which is cost savings. Now that the companies are looking for ways to fight the low prices of Dell, they too can pass on savings to their clients. Therefore, price differential is becoming less of an issue, if not non-existent for consumers. Many of Dells competitors are thus becoming closer alternatives (Holzner 2005). Finally, the fast rate of technological advancements, while usually being an incredible opportunity, is also a huge threat. Nowadays brand names must distinguish themselves from their rivals as the low-cost leadership scheme has become less applicable to computer corporations. In the market lf laptops, this is mainly based on expertise and product design. The latest, fastest, most proficient technology and the most hardwearing, comprehensible product will be more marketable. If a firm fails to be current with modernizations of technology, they will rapidly experience a decline in performance (Ignatiuk 2009). Part B Global Market Search The other two countries in East Africa that Dell has exported its products to are Tanzania and Uganda. Kenya has a stable political background. The president is elected after every five years and a National Assembly Chamber comprises of 210 members, also elected for a five-year term (Country Reports 2012). Political parties that represent a diversity of regional, ideological and ethnic interests are vocal and active, and there exists no major impediments to formation of parties. Kenya is the financial and commercial hub of East Africa. It is also one of the tourist destinations in Africa. The country has a market-based economy with liberalised foreign trade policy. Agricultural exports and tourism comprise the largest income earner to the country (Stein 2010). The political background of Tanzania on the other hand is different from that of Kenya. Unlike Kenya, which has several parties, Tanzanian politics is dominated by CCM party. Its national assembly consists of 232 members and just like Kenya, presidential elections are done after every five years (Fund 2008). Agriculture accounts for more than forty percent of GDP, provides 85 percent of exports, and employs 80 percent of the workforce. In terms of infrastructure, Tanzania has a limited network of roads and rail (Stein 2010). Lastly, Uganda, just like its two counterparts, elects its president after every five years. Their National Assembly Chamber, also elected on a five-year term, comprises of 332 members, 215 of who are directly elected and 104 directly elected. Uganda is endowed with natural resources, including regular rainfall, mineral deposits of copper, gold and cobalt, and fertile soils. Nevertheless, agriculture remains the most significant sector of the economy, employing approximately 80 percent of the workforce. Infrastructure though, remains a critical factor for raising its medium-term growth potential (Stein 2010). The following table summarizes the economic, political and social indicators of the three countries. Kenya Uganda Tanzania Projected population 2025 51,3 million 56,4 million 58,2 million GDP Billion USD 2009 63,7 43,2 57,8 School enrolment ratio 87 27 32 Internet users 2008 3,3 million 2,5 million 520 000 Ranking in global corruption 146 130 126 Ranking in global competitiveness index 2009-2010 98 128 100 The demand for PCs and PC-related services and products has registered a noticeable increase in East Africa owing to the ongoing process of computerization that is sailing through most African countries now. As observed, Dell is likely to succeed doing business in Kenya than Uganda or Tanzania, because of its market based economy and relaxed external trade system. Moreover, there is a high level of computer literacy, particularly among the youth. Kenya’s government is generally thought of as investment friendly and to simplify both local and foreign investment, it has enacted a number of regulatory reforms. Lastly, Kenya has a well-developed physical and social infrastructure. Conclusion As experienced, Dell Corporation is growing and expanding quickly and it might in the future become the leader in the computer industry. It has an increased chance for revenue and access to information that potentially translates to new service and product offerings. With the accelerating embracing of ICT in East Africa, Steve Mackenzie, the corporation’s regional manager for East Africa, states that Dell's entry will provide the market with a variety of choice and improve the quality of products in the sector. One of the strengths of Dell is the fact that it has established relationships with big companies, which pass their relationship on through employees, offering them. One of the weaknesses is the fact that it lacks a large amount of relationships with learning institutions, and as many students buy their laptops through their school programs, thus Dell cannot take advantage of this market opportunity. One of the opportunities is that customers are becoming more educated concerning computers, as a rising number of them are regular customers. Consumers who have bought computers in the past know what they want and Dell can supply to them. Dell products Cutting edge scientifically based organizational practices have to be employed as illustrated in this paper by business firms if they are to be successful and profitable. Reference List Country Reports. (2012). Retrieved September 24, 2012, from http://www.countryreports.org/# Dell, M., & Fredman, C. (2000). Directo De Dell. Ediciones Granica S.A. Dell, M., & Fredman, C. (2006). Direct from Dell: Strategies that Revolutionized an Industry. HarperCollins. Fund, I. M. (2008). Kenya, Uganda, and United Republic of Tanzania: Selected Issue. Washington D.C: International Monetary Fund. Holzner, S. (2005). How Dell Does It. McGraw-Hill Prof Med/Tech. Ignatiuk, A. (2009). Analysis of Dell's Business Strategy. GRIN Verlag. Kotler, P., & Lee, N. (2004). Corporate Social Responsibility: Doing the Most Good for Your Company and Your Cause. New York: John Wiley & Sons. Kraemer, K., Dedrick, J., & Yamashiro, S. (2000). 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Rollins, James M. Schneider, Leslie L. Jackson, Nicholas A.R. Dunning: Securities and Exchange Commission Litigation Complaint. DIANE Publishing. Read More