Dells Direct Business Model Essay

Dells Direct Business Model Essay

Length: 489 words (1.4 double-spaced pages)

Rating: Good Essays

Open Document

Essay Preview

Subject: Dell’s Direct Business Model

     Will Dell’s direct business model continue to provide a competitive advantage as fellow competitors Compaq, IBM, and HP emulate Dell’s direct model?
Dell’s direct business model bypasses the dealer in the supply chain and sells computers directly to customers, building each to order. Dell does not manufacture the computer components; they merely assemble computers based on components that are available in the market.
Dell’s use of technology and information to blur the traditional boundaries between suppliers, manufactures, and users is named virtual integration. To achieve the advantages of an integrated company, Dell treats suppliers and service providers as if they were inside the company. Their systems are linked in real time to Dell’s system and their employees participate in design teams and product launches.
Dell measures inventory velocity which is defined as the reciprocal of the average amount of time a product spends in inventory. Accumulating inventory is the fast moving PC computer industry is very risky due to the fact that many components quickly become outdated.
In 1998 Compaq, IBM, and Hewlett-Packard all announced plans to mimic portions of Dell’s direct business model, with various build to order plans. All have had difficulty in making the transition. These companies are moving towards a target inventory level of four weeks, conversely, Dell maintains just eight days of invento...

Need Writing Help?

Get feedback on grammar, clarity, concision and logic instantly.

Check your paper »

Essay about Groupon's Busness Model

- I. Introduction The term business model gained popularity due to “the explosive growth of new ventures sparked by the internet”1 and is often erroneously used “to glorify all manner of half-baked plans”.2 Strategy is another “buzzword” that is often mistakenly used interchangeably with business model. There are numerous differences between the two but the defining characteristic is that a “business model is independent of competitors and the current state of the market”,3 focusing inwardly to describe, “as a system, how the pieces of a business fit together”.2 Strategy focuses on performance, looking outwardly at the industry, analyzing the current competition, future competition, supplie...   [tags: Business Model, Internet, Strategy]

Good Essays
1051 words (3 pages)

Business Model Change for Retailers Essay

- “Variety is the only constant” such is the saying of Heraclitus. What was true a century back holds true even today. A gradual change is the undercurrent of time. Change is in the air and retail business cannot lag behind. Plan your change model, check out the long-term and short-term strategies and alter the entire retail landscape. From ancient times till now, it's always about survival of the fittest. Evolving your business to survive whether it’s a high end retail chain selling luxury watches, jewelry or handbag planning a good business scheme for international expansion becomes crucial....   [tags: change model, business retailers, e retailers]

Good Essays
1434 words (4.1 pages)

The Business Model Essay

- The Business Model Michael Lewis (2000: pages 256-257) scoffed at the whole attempt to formalize the definition of business models when he wrote that “ “Business Model” is one of those terms of art that were central to the Internet boom: it glorifies all manner of half baked plans. All it really meant was how you planned to make money.” In an abstract of his paper “A Mesoscopic Approach to Business Models: Nano Research on Management” published in “Economic Issues in China” Dr. Junyi Weng stated that “Business Model, a well known important and extensively used term by media, management consultancy and business top managers, is just in an embarrassment that there is no consensus about its...   [tags: Business Management Essays]

Good Essays
1122 words (3.2 pages)

Direct Mail and Email Marketing Essay

- Direct mail marketing is also referred to as direct response advertising. This is because it allows businesses and other organizations to communicate straight to customers using techniques like text messaging, interactive websites, display ads online, email campaigns, flyers, catalogs, letters, television commercials, outdoor ads, and newspaper and magazine ads that normally generate response. There are quite a few characteristics that determine direct marketing. First, generating a database that often contains other information that may be relevant from business to business is used in developing the database of target-marketed businesses....   [tags: Direct Response Advertising, Firm Strategy]

Good Essays
2192 words (6.3 pages)

Business Model: The Reassessment Stage Essay

- Every process that involves change to a business model is very systematic in approach. There is a logical following of step one, step two, etc. The step before must be completely finished before moving along in the process. The step of reassessing and adjusting is similar however; it may be revisited at any time when problems or potential problems are encountered. During the risk assessment, we determined the potential risks of our solutions in a purely conjectural basis. (Adner, 2002) The information that we did not have was how a solution would really work instead we had what we thought would happen....   [tags: business, customer tracking, progress]

Good Essays
632 words (1.8 pages)

Annual Budget Model Essay

- Introduction Budgeting is a process in which every firm has to be involved with not only the board of director (Principle) who authorize the budget but also management team (Agent) who use it as well. In other words, budgeting need communication with every level of employee in the company in order to construct the goal or strategy of the company. Moreover, budgets are an instrument of power as well as being a reflection of power (Ashton et. al., 1995, p.289). Budgets that are not based on well-understood activities and costs are poor indicators of performance (Drury, 2005)....   [tags: Business, Traditional Budgeting Model]

Good Essays
1607 words (4.6 pages)

Foreign Direct Investment in Myanmar Essay examples

- Foreign Direct Investment in Myanmar (Graphics not Included) Since 1962 the Burmese government has been under military rule (Country Profile, 2007). The lives of the Burmese citizen are dictated by the totalitarian style of government which led to horror and starvation, causing numerous protests against the government. The latest protest in 2007 was planned and organized by the same student groups which took part in the similar protest earlier in 1988. The first protest was held on 15 September 2007 with protesters protesting on streets in Yangon on nearly a daily basis....   [tags: FDI Foreign Direct Investment]

Free Essays
1969 words (5.6 pages)

The Implications of an Extranet on the Business Model Essay

- The Implications of an Extranet on the Business Model (graphics not available) Purpose of the Report The purpose of this report is to provide the strategic implications of an Extranet on my company's business model over the next three years. It is understood that the present business model utilizes an Intranet system. Background of the Topic When discussing Web-based technologies, we need to consider three distinct variations: the Internet, the Intranet and the Extranet. Internet The Internet is a public, global network of networks which is based on Internet Protocol (IP) and related standards (http://www.teleshuttle.com/media/extradef.htm)....   [tags: Business Strategy Operational Analysis]

Free Essays
1678 words (4.8 pages)

Dell's Successful Use of the Internet as a Selling Channel Essay

- Dell's Successful Use of the Internet as a Selling Channel Dell are currently the worlds number one PC supplier, a position in the market they took from Compaq in April 2001. In short, the company’s success story is mainly down to their innovative direct business model, which pays particular attention to the selling process where Dell completely bypasses all intermediaries and/or middlemen. This is because Michael Dell believed they add little if no value to the end product, instead just gaining a considerable mark-up for selling the product....   [tags: Business and Management Studies]

Good Essays
1424 words (4.1 pages)

Apple Business Model Essay

- Abstract Apple Incorperation is one of the most sought-after computer campany Introduction The world wide web is very strong and has changed the word in many ways. As a fan of Apple Macintosh,I am personally impressed with many of its innovations.It strikes me whether or not the company has really become monopoly. This paper will explore its business model and its so called I will closely examine Apple in different areas -PC market -software -portable player -music Then the second part deals with the judging of its monopoly position based on the microeconomic aspects....   [tags: Business Analysis Strategy Management]

Free Essays
1809 words (5.2 pages)