Case Study of Dell Computer Corporation :: Business Marketing, Case Study, solution

Case Study of dingle Computer Corporation entryMichael dingle founded Dell Computer Corporation in 1984 with a simple vision and business concept that personal computers can be built to vow and sold directly to consumers. Michael believed his shape up had two advantages (i) by passing distributors and retail dealers eliminated the markups of resellers, and (ii) building to order greatly reduced the costs and risks associated with carrying large stocks of parts, components and finished goods. Its build-to-order and sell-direct approach proved appealing to growing numbers of customers in the mid 1990s as global PC gross revenue move up to record level. In 1998, it was already the 3rd manufacturer in the United States with a 12% share of PC market and a nearly 6% share worldwide. The companys fastest growing market for the past several quarters was Europe. Even during the Asia economic woes in the early 1998, Dells sales in Asia rose 35%. Its sales at the Internet Web site were a bout $5 million a day and expected to reach $1.5 billion annually by the year-end 1998. Since 1990, Dells stock price had exploded from 23 cents per share to $83 per share in May1998 with a 36,000% increase and was the prime performing big company then. Dells principal products included desktop PCs, notebook computers, workstations, and servers. Its products and services were sold in more than 140 countries. The sales of desktop PCs alone accounted for about 65% of Dells total revenues dapple the rest accounted for about 33%. In early 1988, the company has 16,000 employees.Dells Background and VisionDell Computer was first known as PCs Limited in 1984, selling PC components and PCs under the brand summon PCs Limited. Dells strategy was to sell directly to end users by eliminating the retail markup, Dell was able to sell IBM clones at about 40% to a lower place an IBM PC price. By 1985, the company was assembling its own PC designs and had about 40 employees. Sales had reached $ 33 million by the year ending 1986.Michael Dell sought to refine the companys business model, add needed production capacity, and build a bigger, deeper management staff and corporate infrastructure while at same time keeping costs low. It first international offices were opened in 1987 and was renamed Dell Computer. In 1998, Dell became a public company, raised $34.2 million in its first offering of common stock. Michael Dells vision was for Dell Computer to become one of the top three PC companies.