Competitive Advantage Of Dell

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Dell have used their internal resources and competences as a way of gaining a competitive advantage to great effect over the past few decades. There are three basic resources: tangible assets, intangible assets and organisational capabilities. Dell’s greatest resource in generating a competitive advantage has been their direct model approach to sales. This direct model approach means that customers buy directly from Dell through their website. The advantages this brings are that the customer can customise their product, buying exactly what is right for them. Whereas competitors offer the customer the choice of number of models, Dell allow the customer to choose exactly they want. Dell’s direct model means that Dell does not have to sell via …show more content…

One of Dell’s greatest intangible assets is the reputation of the company. This reputation they have built for themselves gives them an advantage over their competitors as customers are more likely to trust Dell’s products so if it became a choice of two products, the name Dell may be enough to influence the buying decision. Along with the reputations surrounding the products, Dell also holds a strong reputation for their customer service. “Dell’s free customer service system is open 24 hours a day, seven days a week” (Cusham et al., 2003, p.23). Dell use offshoring for their call centre customer service teams. Using offshoring gives a competitive advantage as it allows them to use low cost labour while still achieving high levels of productivity. However, offshoring customer service can be dangerous as the cultural differences may be negative. The accents of some staff may be difficult to understand and infuriating for the customer as well as the added cost of having to train the unskilled …show more content…

However, there are only two suppliers of the processors which are used in Dell products so these two companies will have high supplier power due to the lack of competition within their market.
Buyer Power: Dell has a large number of competitors including Apple, HP and Lenovo. The large number of competitors and the increased saturation of the computer hardware industry over the years has meant that the main factor for the customer to choose another brand would be the price. There are no additional costs to the customer if they wish to switch brands which makes it very easy for them to do

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