DELL project


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DELL project

  1. 1. Group #4 Dell Corporation in Brazil
  2. 2. Outline <ul><li>About Brazil </li></ul><ul><li>About DELL </li></ul><ul><li>SWOT </li></ul><ul><li>Preconditions of entering Brazil </li></ul><ul><li>DELL strategic position </li></ul><ul><li>PESTEL analysis </li></ul><ul><li>Key Success Factors </li></ul><ul><li>DELL's sub-branding </li></ul><ul><li>Recommendations </li></ul>
  3. 3. About Brazil <ul><li>Largest population in Latin America – 180 mln inhabitants </li></ul><ul><li>Good economy conditions </li></ul><ul><li>Mercosur custom union with other countries of Latin America (duty-free access to all of the members of union) </li></ul><ul><li>Exchange rate R$/US$ is increasing (appreciation of R$) </li></ul>
  4. 4. <ul><li>By year 2000 Brazilian economy is growing rapidly </li></ul><ul><li>Production growth increased by 11,2%, while predicted rate was only 6,8% </li></ul><ul><li>Export increased by 13.8% ($8.62 bln.) </li></ul><ul><li>Import increased by 18.6% ($9.02 bln.) </li></ul>About Brazil
  5. 5. Brazilian PC Market <ul><li>Main segments in PC market: </li></ul><ul><li>Home </li></ul><ul><li>Small business </li></ul><ul><li>Government </li></ul><ul><li>Commercial </li></ul>
  6. 6. Gray Market and Firms <ul><li>Imported computers were dismantled and re-assembled receiving a local brand and sold at dramatically low prices </li></ul><ul><li>Imported parts without duties </li></ul><ul><li>Workers under table </li></ul><ul><li>Frequent infringement on copyrights </li></ul><ul><li>No sales taxes </li></ul><ul><li>Not required to invest in government programs </li></ul>
  7. 7. DELL <ul><li>Founded in 1984 by Michael Dell </li></ul><ul><li>Products: </li></ul><ul><li>Servers, storages and networking </li></ul><ul><li>Printing and imaging </li></ul><ul><li>Computers </li></ul><ul><li>Electronics and accessories </li></ul><ul><li>Enterprise services </li></ul><ul><li>Customer services </li></ul><ul><li>DELL's concept is that by selling computer systems directly to customers will help to understand their needs better </li></ul><ul><li>Strategy contains direct customers model with new distribution channels </li></ul>
  8. 8. DELL Development <ul><li>Direct model (1984) </li></ul><ul><li>Global expansion (1987) </li></ul><ul><li>Mobile computing (1989) </li></ul><ul><li>Evolve of desktop (1991) </li></ul><ul><li>Servers and storages (1994) </li></ul><ul><li>Revolution in the customer experience (1996) </li></ul><ul><li>Customer-driven enterprise innovation (1997) </li></ul><ul><li>Leads the industry (2000) </li></ul><ul><li>Community involvement and environmental responsibility (2003) </li></ul>
  9. 9. Customer-Driven Innovation Listen=> Solve=> Impact <ul><li>DELL gathers requirements directly through customer interactions daily, organized events, social media venues, and customer panels, which gives a uniquely broad perspective on the computing landscape. </li></ul><ul><li>The mission is to deliver innovative and cost-effective solutions that meet today's real-life customer challenges and work in existing environments and with other products. </li></ul><ul><li>Dell is uniquely positioned to impact industry trends </li></ul>
  10. 10. FACTS about DELL <ul><li>Every Fortune 100 company does business with Dell. </li></ul><ul><li>DELL is the #1 PC provider in the U.S. and #2 worldwide. </li></ul><ul><li>About 140,000 systems shipped per day, on average – that’s more than one every second. </li></ul><ul><li>DELL more than 400 product awards in 2007. </li></ul><ul><li>DELL rank No. 34 among the Fortune 500 </li></ul><ul><li>24 of the world’s top supercomputers run on Dell. </li></ul><ul><li>The top 6 Internet service companies run on Dell. </li></ul><ul><li>Its the first and only computer company offering free computer recycling to consumers worldwide. </li></ul>
  11. 11. SWOT Analysis STRENGHTS WEAKNESSES <ul><li>Brand recognition </li></ul><ul><li>Cuts out the retailer </li></ul><ul><li>Lea d supply chain; relatively cheap labor </li></ul><ul><li>Online capabilities to customize products </li></ul><ul><li>Strong service reputation </li></ul><ul><li>Huge range of products </li></ul><ul><li>C omponents from many suppliers from various countries </li></ul><ul><li>Inventory </li></ul>OPPORTUNITIES THREATS <ul><li>Diversification strategy by introducing many new products </li></ul><ul><li>Making and selling low-cost, low-price computers </li></ul><ul><li>Change in management could lead the company into a new business model </li></ul><ul><li>Competitive rivalry that exists in the PC market globally </li></ul><ul><li>New entrants to the market pose potential threats </li></ul><ul><li>Exposed to fluctuations in the World currency markets (i.e., changes in exchange rates) </li></ul>
  12. 12. Preconditions for Entering Brazil <ul><li>Increasing demand from global clients </li></ul><ul><li>Long delivery times </li></ul><ul><li>High delivery costs </li></ul><ul><li>Customs regulations, tariffs and frequent strikes </li></ul><ul><li>Import tax rate for PC was 32% in 1998 </li></ul>
  13. 13. Dell Strategic Position Threat of Entrance Rivalry Bargaining Power Suppliers Bargaining Power Buyers Threat of Substitute Medium High Low High Low
  14. 14. PESTEL Analysis <ul><li>Political </li></ul><ul><ul><li>Changes of government ideology (policy, etc) </li></ul></ul><ul><ul><li>Influences of local municipal reform </li></ul></ul><ul><li>Economic </li></ul><ul><ul><li>Largest population with GDP factor </li></ul></ul><ul><ul><li>Well-developed manufacturing, services and other sectors </li></ul></ul><ul><li>Social </li></ul><ul><ul><li>Dell Corp. has good international reputation </li></ul></ul>
  15. 15. PESTEL Analysis <ul><li>Technological </li></ul><ul><ul><li>Computer technology can be used as a tool in production sector of Brazil </li></ul></ul><ul><li>Environmental </li></ul><ul><ul><li>El Dorado was located near universities and 4 metropolitan centers </li></ul></ul><ul><ul><li>Competition for inner city facilities (gray market) </li></ul></ul><ul><li>Legislative </li></ul><ul><ul><li>Implemented reserve policy </li></ul></ul><ul><ul><li>Legislation on product </li></ul></ul>
  16. 16. Key Success Factors <ul><li>Direct Marketing Model </li></ul><ul><li>Lower Cost Differentiation </li></ul><ul><li>Quality Product </li></ul><ul><li>Customization of Product </li></ul>
  17. 17. Dell’s Sub-Branding <ul><li>Sub-brands : </li></ul><ul><ul><li>C an fit with local communities </li></ul></ul><ul><ul><li>Must show something similar to the umbrella brand </li></ul></ul><ul><ul><li>H elps identify perception of the specific audience </li></ul></ul><ul><li>Dell need to sure that the brand connects : </li></ul><ul><ul><li>E motional and rational aspect </li></ul></ul>
  18. 18. Recommendation and Alternatives <ul><li>DELL must be aware of the benefits they want to realize </li></ul><ul><li>Ensure the image </li></ul><ul><ul><li>customer satisfaction </li></ul></ul><ul><ul><li>consumer awareness </li></ul></ul><ul><li>DELL relies on reputation in the Brazil market </li></ul><ul><ul><li>award-winning service </li></ul></ul><ul><ul><li>high-quality product </li></ul></ul>
  19. 19. <ul><li>THANK YOU FOR YOUR ATTENTION! </li></ul><ul><li>You are welcome to ask questions </li></ul>