History of Dell Corporation

University Degree Business and Administrative studies

Dell Computer Corporation

In 1984, Michael Dell founded Dell Computers. Since its foundation, the company has seen sales growth from $6 Million to almost $35 Billion in 18 years. Company revenue in the past year totaled $41.4 billion. Today the company ranks 31st in the Fortune 500 list. (Retrieved from Proquest) It is among the top 5 companies globally for manufacturing personal computer systems. Dell is a premier provider of products and services required for customers worldwide to build their information-technology. Dell’s climb to market leadership is the result of a persistent focus on delivering the best possible products and services based on industry-standard technology. Revenue for the last four quarters from totaled 35.4 Billion and the company employs approximately 39,100 team members around the globe. () Listed below is a synopsis of Dell Corporation history.

1984 - Dell is founded by Michael Dell, who has since become the computer industry’s longest-tenured CEO.
1985 – Dell introduces the Turbo, its initial PC, which features an 8MHz Intel 8088 processor. The company begins international expansion with the opening of its UK subsidiary.
1988 – Dell goes public, offering $3.5 million worth of shares.
1991 – The Company rolls out its first notebook PC, and begins selling its computers through retail and office supply channels.
1993 – Dell enters the Asia/Pacific region with the opening of subsidiaries in Australia and Japan. Its revenues rank the company among the top-five PC makers in the in the world.
1994 – The Company abandons its practice of selling its computers through retail establishments in favor of direct-mail sales.
1996--Dell initiates e-commerce through its Web site. Later in the year, the company begins to manufacture network servers.
1998– Web sales climb to an excess of $4 million daily. Dell introduces its Power Vault storage products, and opens a production and customer center in China.
1999 – The company opens it Latin American manufacturing facility in Brazil, and introduces an online technical support service.
2000 – The compnay’s Internet sales reach $50 million daily. Dell enters the B2B e-commerce arena, ranking first in terms of global workstation shipments.
2001 – Dell successfully sues DELLKOREA.COM in defense of its brand name under the Anti-cyber squatting Consumer Protection Act of 1999, according to a ruling by the US District Court for the Eastern District of Virginia. The company also introduces its Power Connect network switches.
2002 – Dell enters the handheld market with the release of its Axiom X5. Its networking and server market position increase with broader adoption of its Power Connect and Power Edge products.
2003 – Changed its corporate name to Dell, Inc. To reflect the diversiification of teh compnay’s business applications from PCs to servers, handhelds, peripherals, and storage systems.
2004 – Michael Dell, the company’s founder, decided to hand over the title of CEO to Kevin Rollins, his partner since 1997. Dell agreed to retain the title of board chairman. Dell decided that this was the optimum time to hand over every day operation to his partner, while the company was in good shape financially and riding continually improving sales figures.

Competitors

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Competitors

Dell’s net revenue almost doubled from 1999 to 2003. It increased from $18 Billion to $35 Billion. The sales from 1998 to 1999 increased by 58%. Dell’s market share is strong and ever increasing. It currently holds 17% of the global technology hardware market and ranks 1st in market position. Dell holds 29% of the United States market and currently #1 in market position. Currently Dell sells 50 Million worth of merchandise a day through the Internet. () The personal computers market refers to the development, manufacture, and sale of personal computers and related computer equipment. The global market is highly competitive especially among major companies like Hewlett Packard (HP) and IBM. These companies account for almost 40% of the PC Industry sales globally while others account for 60%. Both, Dell & Hewlett Packard are always abreast when it comes to market positioning. The growth for the industry will remain strong. Dell faces major competition worldwide. Hewlett Packard came into existence in 1939. Its acquisition with Compaq took a vast portion of the PC market before the entry of Dell computers. IBM personal systems division reported sales of 11.2 Billion for the year 2002, down by 7.5% when compared to 2001 sales of 12 billion. The companies PC division showed profit of 57 million for 2002 when compared to a loss of 153 Million for 2001. ()

Business Strategy

Dell’s strategy is collapsing profit margins throughout the PC market. Dell is pricing its machines not so much like high-tech products, but more like any low-margin commodities. That puts pressure on Dell to push up sales volume to compensate for the thinner margins. Dell's product life cycle is very good and as Dell being the best among and once the top company selling PCs, we can conclude that Dell product life cycle is in maturity level. From the market share that Dell got in 3rd Quarter of 2001, we can see that Dell was doing quite well that time. From it’s business strategy, Dell is going to do well in the years ahead and they are going to dominate the computer world. The company's revenue for the past four quarters totaled $32.6 billion. Dell ranks No. 48 on the Fortune 500, No. 154 on the Fortune Global 500 and No. 10 on the Fortune "most admired" lists of companies. Dell, through its direct business model, designs, manufactures and customizes products and services to customer requirements, and offers an extensive selection of software and peripherals.

Dells growth strategy is to double in size in the next 5 years. It sees huge potential in diversifying like its entry into the Printer Market and its expansion in the Enterprise market where more & more customers are turning to Dell for networking solutions. Dell’s strategy is to keep costs low, while not compromising on quality and implementing the latest technology as far as possible. With this sought of strategy it’s a growing threat to IBM’s business which is the market leader in Enterprise network solutions.