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Dell Inc.
(512)
338-4400
One
Dell Way
Round
Rock, TX 78682
www.dell.com
Sales
$41
billion
Business Description
Dell
Inc. (formerly Dell Computer Corporation), with annual revenue of $41.4
billion, is a premier provider of computing products and services. As a
result of its direct business model, Dell was the leading seller of computer
systems worldwide and the number one seller in all customer segments in the
United States during calendar 2003.
Dell was founded in 1984 by Michael Dell on a simple concept: by selling
computer systems directly to customers, it could best understand customer
needs and efficiently provide the most effective computing solutions to meet
those needs. Dell’s climb to market leadership is the result of a relentless
focus on delivering the best customer experience by selling computer systems
and services directly to customers.
Products
Dell designs, develops, manufactures, markets, sells, and supports a wide
range of computer systems that are customized to customer requirements.
These include enterprise systems (servers, storage, networking products, and
workstations), client systems (notebook and desktop computer systems),
printing and imaging systems, and software and peripherals.
• Servers. Dell’s standards-based PowerEdgeTM line of servers is designed to
provide customers affordable performance, reliability, and scalability.
Options include high performance rack and tower servers for enterprise
customers and aggressively priced tower and appliance servers for small
organizations and networks. Dell ranks number one in the U.S. and number two
worldwide in shipments of x86 servers (based on standard Intel
architecture). During calendar 2003, Dell increased its worldwide market
share ranking by 1.8 points and maintained its No. 2 position at 23.4%.
• Storage. Dell/ EMCTM and Dell’s PowerVaultTM lines of storage products
offer customers a comprehensive portfolio of cost-effective hardware and
software solutions to protect customer data. Dell offers external storage,
tape backup products, network attached storage, fibre channel arrays,
storage area networks, and rack solutions. Net revenue for Dell’s PowerVault
and Dell/ EMC systems grew 58% during fiscal 2004 and continues to become an
increasing portion of Dell’s consolidated revenues.
• Networking Products. Dell’s PowerConnectTM switches are standards-based
network switches that connect computers and servers in small- to
medium-sized networks. PowerConnect products offer customers
enterprise-class features and reliability at a low cost. Dell introduced the
PowerConnect line of network switches in the third quarter of fiscal 2002.
• Workstations. Dell offers the Dell PrecisionTM desktop workstation and the
Dell Precision mobile workstation. These products are intended for
professional users who demand exceptional performance to run sophisticated
applications, such as three-dimensional computer-aided design, digital
content creation, geographic information systems, computer animation,
software development, and financial analysis. In calendar 2003, Dell held
the number one position in the U.S. and worldwide for branded workstation
unit shipments.
• Notebook Computers. Dell offers two lines of notebook computer systems.
The LatitudeTM line of notebooks is designed to address a wide range of
business and organizational needs, including powerful performance,
portability, and flexibility. Latitude offerings range from wireless-ready,
highly expandable full-featured models to thin, light ultra-portable models.
The InspironTM line of notebooks is targeted to customers who require
high-performance computer systems at aggressive prices. Typical customers
are individuals or small-to-medium sized businesses that require optimum
performance for their investment. Dell ranked number one in the U.S. and
number two worldwide in notebook computer shipments in calendar 2003.
• Desktop Computer Systems. Dell offers two lines of desktop computer
systems. The OptiPlexTM line of desktop systems is designed for corporate,
institutional, and small business customers who demand highly-reliable,
stable, manageable, and easily serviced systems within networked
environments. The DimensionTM line of desktop systems is designed for small
businesses and home users requiring fast technology turns and
high-performance computing. The Dimension product line typically features
the latest high-performance components. Dimension customers include
corporate and institutional customers as well as small businesses and home
users. Dell ranked number one in the U.S. and worldwide in desktop shipments
in calendar 2003.
• Printing and Imaging Systems. Dell offers a wide array of Dell-branded
printers, ranging from consumer inkjets to large workgroup lasers. The Dell
printer product line is focused on making printing easier to buy, easier to
own, and easier to use. All Dell printers feature the Dell Ink Management
SystemTM or Dell Toner Management SystemTM, which simplifies the purchasing
process by displaying ink or toner levels on the status window during every
print job and proactively prompting users to order replacement cartridges
directly from Dell. During fiscal 2004, Dell launched its branded printer
line and shipped almost two million Dell-branded printers.
• Software and Peripheral Products. Dell offers a multitude of competitively
priced software and peripheral products including those from leading
manufacturers. Products offered include software, monitors, printers,
handhelds, notebook accessories, networking and wireless products, memory,
digital cameras, projectors, and scanners. During fiscal 2004, Dell
announced several new Dell peripheral products, including power adaptors,
LCD televisions, and MP3 players.
Services
By applying the direct model to its services business, Dell seeks to
simplify customers’ computing experience by offering a full range of
flexible, tailored solutions. Dell offers a portfolio of services that help
maximize information technology (“IT”), rapidly deploy systems, and educate
IT professionals and consumers.
• Managed Services. Dell Managed Services offers customers a wide range of
IT management services. These services allow customers to lower annual
service costs and enhance system performance without sacrificing control of
their IT systems. Dell Managed Services assists customers in planning,
deployment, maintenance, asset management, on-site field services, and other
related services.
• Professional Services. Dell Professional Services offers services to help
businesses utilize emerging technology, enhance efficiencies, reduce
business risk, and maximize return on technology investment. Using its
expertise and best practices in technology consulting, application
development, solutions integration, and infrastructure design, Dell designs,
develops, and implements end-to-end technology solutions.
• Deployment Services. Dell’s deployment services are designed to rapidly
configure and deploy Dell systems and products into IT environments. Dell’s
custom factory integration services allow customers to configure systems to
meet their specific hardware and software needs. Additional deployment
services include asset management and recovery services, custom delivery
services, installation services, managed deployment services, and image
management services.
• Support Services. Dell Support Services helps maximize the value and
performance of customer technology, while minimizing expense and
inconvenience. Offering a variety of customized services and support
programs tailored to meet specific customer requirements, Dell’s support
ranges from remote software and enterprise support to on-site support. For
example, for enterprise customers, Dell offers four tiers of service through
Enterprise Support for server and storage systems, ranging from
comprehensive around-the-clock support for mission-critical systems to next
business day on-site support for non mission-critical systems. For customers
in the U.S., Dell’s Total Satisfaction Policy currently allows customers to
return desktop and notebook systems to Dell for any reason within 30 days of
purchase. In addition, Dell provides a limited warranty for all computer
systems for a period generally ranging from 90 days to three years and
offers 24 hour telephone and online technical support. Dell also offers
warranty upgrades and services such as CompleteCare accidental damage
protection, At Home Service for technical support service at home or work,
Express Tech Support for priority access to Dell’s technical support team,
and home installation services.
• Training and Certification Services. Dell offers training and
certification programs for business and consumer customers worldwide. Dell’s
online training programs feature over 1,200 courses for consumer, business,
and IT professionals. The courses are designed for all skill levels and
range from personal finance to business productivity to IT certification.
For enterprise customers, Dell offers Dell service technician training and
system administration training and certification (both on-site and at Dell
labs) through Dell Certification Programs. These programs provide system
administrators and technicians the ability to learn the intricacies of Dell
equipment both before and after installation to allow customers to maximize
their return on investment.
Business Strategy
Dell’s business strategy combines its direct customer model with a highly
efficient manufacturing and supply chain management organization and an
emphasis on standards-based technologies. This strategy enables Dell to
provide customers with superior value; high-quality, relevant technology;
customized systems; superior service and support; and products and services
that are easy to buy and use. The key tenets of Dell’s business strategy
are:
• A direct relationship is the most efficient path to the customer. Direct
customer relationships provide a constant flow of information about
customers’ plans and requirements and enable Dell to continually refine its
product offerings. The direct model also eliminates the need to support an
extensive network of wholesale and retail dealers. As a result, Dell reduces
customers’ prices by avoiding expenditures associated with the retail
channel, such as higher inventory carrying costs, obsolescence associated
with technology products, and retail mark-ups.
• Customers can purchase custom-built products and custom-tailored services.
Dell believes the direct model is the most effective business model for
providing solutions that truly address customer needs. In addition, Dell’s
flexible, build-to-order manufacturing process enables Dell to achieve
faster inventory turnover and reduced inventory levels. This allows Dell to
rapidly incorporate new technologies and components into its product
offerings and to rapidly pass on component cost savings directly to its
customers.
• Dell is the low-cost leader. Dell’s highly efficient supply chain
management and manufacturing organization, efficient direct-to-customer
model, and concentration on standards-based technologies allow Dell to
maintain the lowest cost structure in the industry and pass on those savings
to its customers. Additionally, Dell’s focus on cost control during fiscal
2004 resulted in the lowest operating expense (measured as a percent of net
revenue) in Dell’s history and the lowest among its major competitors during
the year. Dell’s relentless focus on reducing its costs allows it to
consistently provide customers with a superior value.
• Dell provides a single point of accountability for its customers. Dell
recognizes that as technology needs become more complex, it becomes more
challenging for customers to efficiently address their computing needs. Dell
therefore strives to be the single point of accountability for customers
with complex technological challenges. Dell offers an array of services
designed to provide customers the ability to maximize system performance,
efficiency, and return on investment.
• Standards-based technologies deliver the best value to customers. Dell
believes that standards-based technologies are critical to providing
customers with relevant, high-value products and services. Focusing on
standards gives customers the benefit of extensive research and development
from Dell and its entire supply chain, rather than a single company. Unlike
proprietary technologies, standards provide customers with flexibility and
choice while allowing their purchasing decisions to be based on performance,
cost, and customer service.
Financial Services
Dell offers various financing alternatives, asset management services, and
other customer financial services for its business and consumer customers in
the U.S. through Dell Financial Services L.P. (“DFS”), a joint venture
between Dell and CIT Group, Inc. (“CIT”). For government, some small
businesses, and international customers, Dell partners with a variety of
third-party financial services companies to offer financial services.
Sales and Marketing
Dell sells its products and services directly to its customers through
dedicated sales representatives, telephone-based sales, and online sales
through www.dell.com. Dell’s customers include large corporate, government,
healthcare and education accounts, as well as small-to-medium businesses and
individuals. Within each of Dell’s geographic regions, Dell has divided its
sales and marketing resources among these various customer groups. No single
customer accounted for more than 10% of Dell’s consolidated net revenue
during any of the last three fiscal years.
Dell’s sales and marketing efforts are organized around the needs, trends,
and characteristics of Dell’s customers. Dell’s direct model provides direct
and continuous feedback from its customers, thereby allowing the company to
develop and refine its products and marketing programs for specific customer
segments. This constant flow of communication, which is unique to the direct
model, also allows Dell to rapidly gauge customer satisfaction and target
new or existing products.
For large business and institutional customers, Dell maintains a field sales
force throughout the world. Dedicated account teams, which include
field-based system engineers and consultants, form long-term relationships
to provide each customer with a single source of assistance and develop
specific marketing programs for these customers. For large, multinational
customers, Dell offers several programs designed to provide single points of
contact and accountability with global account specialists, special global
pricing, consistent service and support programs across global regions, and
access to central purchasing facilities. Dell also maintains specific sales
and marketing programs targeted at federal, state, and local governmental
agencies as well as specific healthcare and educational markets.
Dell markets its products and services to small-to-medium businesses and
consumers primarily by advertising on television and the Internet,
advertising in a variety of print media, and by mailing a broad range of
direct marketing publications, such as promotional pieces, catalogs, and
customer newsletters. A majority of the sales to small-to-medium businesses
and consumers occur online through www.dell.com. Dell also operates Dell
Direct Stores in certain states as well as non-U.S. locations, which are
kiosks typically located within shopping centers, that allow customers to
view Dell products in person and purchase online from Dell with the
assistance of a Dell expert.
Manufacturing
Dell manufactures most of the products it sells. Dell has six manufacturing
locations worldwide to service its global customer base. Dell believes that
its manufacturing processes and supply-chain management techniques provide
it a distinct competitive advantage. Its build-to-order manufacturing
process is designed to allow Dell to significantly reduce cost while
simultaneously providing customers the ability to customize their product
purchases. Dell’s supply chain management decreases Dell’s exposure to the
risk of declining inventory values, allows Dell to quickly incorporate new
technologies or components into its product offerings and allows Dell to
rapidly pass component cost savings directly to customers.
Dell’s manufacturing process consists of assembly, functional testing, and
quality control. Testing and quality control processes are also applied to
components, parts, and subassemblies obtained from suppliers. Quality
control is maintained through the testing of components, parts, and
subassemblies at various stages in the manufacturing process. Quality
control also includes a burn-in period for completed units after assembly,
on-going production reliability audits, failure tracking for early
identification of production and component problems, and information from
Dell’s customers obtained through services and support programs. Dell is
certified, worldwide, by the International Standards Organization to the
requirements of ISO 9001: 2000. This includes the design, manufacture, and
service of computer products in all Dell regions.
Product Development
Dell’s product development efforts are focused on designing and developing
standards-based, competitively priced products that incorporate the
technologies and features that Dell believes are most desired by its
customers. To accomplish this objective, Dell has developed cooperative,
working relationships with many of the world’s most advanced technology
companies. Working with these companies, Dell engineers manage quality,
integrate technologies, and design and manage system architecture. This
cooperative approach allows Dell to determine the best method and timing for
delivering new technologies to the market.
During fiscal 2004, Dell’s research, development, and engineering expenses
were $464 million, compared with $455 million for fiscal 2003 and $452
million for fiscal 2002. Dell invests in research, development, and
engineering activities to develop and introduce new products and to support
its continued goal of improving and developing efficient procurement,
manufacturing, and distribution processes.
Ticker
DELL
SIC Code
SIC:
3571 - Electronic Computers
Desktop Computers- Category Main Page
Notebook Computers -
Category Main Page
Printers
- Category Main Page
Servers - Category Main Page
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