I. Since its inception nearly 25 years ago, Dell has built a profitable direct-to-customer business model. Today, more than 80% of Dell’s sales are to commercial customers (e.g., business, government, and not-for-profit organizations). In 2007, Dell added a significant commercial customer segment – retailers. You can read more about this development on Dell’s blog at http://dellshares.dell.com/archive/tags/Retail/default.aspx .
a) Is adding this new market segment consistent with or a departure from Dell’s strategy? Explain your answer.
Let me first explain what I know about Dell’s operations from the perspective of distribution and warehousing operations according to my direct experience working for them in Mexico City.
I used to work at a Logistic (warehouse and distribution) company name “Kuehne & Nagel” in Mexico City in which one of our biggest an profitable customer was DELL.
I used to be the warehouse and distribution supervisor for DELL at Kuehne & Nagel. We were in charge of the warehousing and distribution off all their products all over Mexico. They explained us that all the PDA’s and laptops are manufactured in Taiwan and Singapore and shipped by air to Nashville. The monitors and flat panels they are also manufactured overseas, Asia and Brazil. The Desktops and servers are manufactured at Austin Tx, where it is also their headquarters. This is amazing for me to know that Dell, being one of the world leader seller of computers and computer accessories, its manufacturing activities are all over the world with their suppliers and business partners.
In average Kuehne & Nagel has a shipped complete time of 15 calendar days. Shipped complete means the time since the order is on status ready to go. This is after all the manuf ...