Strength

For Dell, the strength of it is Dell employed over 76 million of workers which means that Dell has strong
manpower. Secondly, Dell has low manufacturing cost and nine manufacturing plants. Furthermore, Dell
provides non-rest customer service which running 24 hours for 7 days a week. Other than that, Dell built
its product based on customers provide specifications which leads to higher customers’ satisfaction. Last
but not least, Dell is the first company which establish product-recycling goal in information technology
industry.

weaknesses

Dell declared the turndown of its manufacturing plant in Limerick, Ireland on 8 January 2009 with the
loss of 1900 workers. Secondly, Dell is weak at attracting the students in schools and colleges, this
segment of market is only get 5% of the total revenue of Dell. Other than that, Dell is facing many
criticisms against its claim of world most secured laptops. Lastly, the dependency of Dell towards its
suppliers is high which means that Dell’s activities will be limited by its suppliers.

Opportunity

For Dell, the main opportunity is the reduction in cost of the latest technology. Secondly, the new
partnership and acquiring of suppliers are also a crucial opportunity for Dell. Furthermore, Dell has got
the opportunity to directly sell its products to retailers and customers which can greatly decrease the
products’ price level.

Threat

For Dell, the main threat is the fluctuation of currency outside of US. Secondly, as Dell is marketing its
products globally, there are many major competitors in the market. Furthermore, as the global financial
recession took place earlier, Dell’s revenue will most likely be reduced by the effect of it. Last but not
least, Dell’s products will be obsolete easily as the change rate of technology is extremely fast, which
means that Dell will need to put in more investment into the research and development departments
and will lead to higher product cost.

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PESTEL and SWOT analysis of Dell computer company

Dell Inc. is an American multinational computer technology corporation that develops, sells, repairs and
supports computers and related products and services. The company is one of the largest technological
corporations in the world and is listed as number 44 in the Fortune 500 list. It is the third largest PC
vendor in the world after HP and Lenovo.

You can find more information about the business in its official website or Wikipedia’s article.

SWOT

Dell SWOT analysis 2013

Strengths

Brand name valued at $7.5 billion

Product customization

Environmental record

Competency in mergers and acquisitions

Direct selling business model

Weaknesses

Commodity (computer hardware) products

Poor customer services

Low investments in R&D

Weak patents portfolio

Too few retail locations

Low differentiation

Opportunities

Expand services and enterprise solutions businesses

Obtain more patents through acquisitions

Strengthen their presence in emerging markets

Tablet market growth

Threats

Growing demand for smartphones and tablets

Profit margin decline on hardware products

Slowing growth rate of the laptops market

Intense competition

Strengths

Brand name. Dell has a very strong brand reputation for quality products. Its brand is valued at $ 7.5
billion.

Product customization. Dell allows its customers to customize their laptops. Such services were not
originally found within any other major computer retailer (and currently only Sony and Toshiba allow
that), but add great value to the customers and provides Dell with a competitive advantage.

Environmental record. Dell is engaged in many green initiatives and has received many rewards for being
an eco-friendly business. This is a benefit when working with public and government agencies.

Competency in mergers and acquisitions. Over the last five years Dell has spent $13 billion for successful
mergers and acquisitions, which brought patents, new capabilities, assets and skills to the business.

Direct selling business model. Dell doesn’t sell its products through big-box retail outlets but instead sells
directly to consumers and enterprises, keeping their already thin profit margin to themselves.

Weaknesses

Commodity products. The large stream of Dell’s revenues comes from computer, especially laptop, sales,
which is a commoditized product. Computer hardware (commodity) products are sold with a very low
profit margin.

Poor customer services. Once praised, Dell’s customer services deteriorated due to outsourcing its call
centers offshore. Dell invested a large sum of money in fixing this, but hasn’t yet regained its previous
reputation for customer services.

Low investments in R&D. The company spends a much lower percentage of its income on R&D that its
main competitors and thus, missed an opportunity to develop strong products for smartphones and
tablet markets as well as to learn new skill and capabilities.

Weak patent portfolio. Due to low spending on R&D Dell hasn’t acquired a strong portfolio of patents
and is now finds it hard to compete in lucrative smartphones and tablets market.
Too few retail locations. Selling products online saves money and allows for product customization but
provides less visibility for the products. The consumer finds it hard to trust the products if it can’t hold it
first in his hands.

Low differentiation. Low price was once Dell’s competitive advantage but the company is no longer able
to provide competitive prices. Apart from the price, Dell’s products are little differentiated from
competitors’ products and are in competitive disadvantage if the price offered by competitor is lower.

Opportunities

Expand services and enterprise solutions divisions. Dell provides various services (cloud, security and
infrastructure) and enterprise solutions (servers, networking and storage), which are the most profitable
Dell’s business at the moment. Dell business should focus on growing these divisions as they promise
better growth opportunities and higher profit margins.

Obtain more patents through acquisitions. If Dell wants to diversify, it needs new technology patents and
new ideas. Dell hasn’t properly established its R&D facilities to discover new technologies and patents,
so the only feasible way to obtain patents and technologies is to acquire other companies.

Strengthen their presence in emerging markets. Emerging economies are the fastest growing markets for
laptops, tablets and other electronic devices. Dell has a good presence in these markets but should
strengthen its position as the company experiences declining market share.

Tablet market growth. Tablet market is expected to grow in double digits for the next few years and the
company has a great opportunity to release new tablet models and benefit from the market growth.

Threats

Growing demand for smartphones and tablets. With a lower price and strongly improved capabilities,
consumers often choose tablets and smartphones over laptops. The growing demand for the previous
devices takes a share out of laptops, the main stream of revenue for Dell.

Profit margin decline on hardware products. Dell’s main income is from selling hardware products, which
prices will increase in the future due to rising raw material prices. This will add to costs for Dell and will
further cut the profit margin.

Slowing growth rate of the laptops market. Growth rate of the computer market is slowing down and in
the near future the markets will become saturated. It will prove hard for Dell to compete in such market
or at least fight back the lost market share.

Intense competition. The company faces intense competition in all its business segments. It competes in
terms of price, quality, brand, technology, reputation, distribution and range of products, with Acer,
Apple, HP, IBM, Lenovo and Toshiba.
https://www.nap.edu/read/11514/chapter/5

SWOT analysis of Dell Computer: Strengths

Biggest PC maker in the world.

They deal directly with the customers with no use of a middle man.

They design the computer to the customer's specifications.

Their assembly is done at a fairly inexpensive cost.

They offer their customers the ability to track their delivery.

They are the number one PC provider for medium and small businesses across the US for 10 straight
years.

They ship around one hundred and forty thousand computers in a day.

They have very good branding and are one of the most known computers in the world.

SWOT analysis of Dell Computer: Weakneses

Dealing with a large amount of supplies from many different countries can cause a large issue when
products are recalled.

They build computers, not develop them.

Their supply orders are so large that they become limited to dealing with a small few supplies that can
handle the volume.

They have weak business relationships with many computer retailers.

They do not have unique technologies to offer the market.

SWOT Manager lets you manage and quickly create your brainstorm SWOTs. Compare the past and track
the future.

SWOT Manager

Opportunities
Maintaining the excellent lead that was taken by the founder, Michael Dell will be challenging.

The introduction of new and enticing products to the customers.

Branding their lower cost, lower priced computers that are sold anonymously throughout the world to
open other avenues of branding opportunities.

Maintaining and expanding the one stop shopping abilities that are offered to their customers.

Continuing to market on the internet to gain larger market bases.

Broadening their scopes in Europe, India and China.

Expand into government and education markets.

Threats

Increasingly popular brand names in the competition.

Strong relationships that are held between competition and the retailers.

Competition can basically create the same computers since Dell builds computers, not designs them.

Fluctuations in the currency markets can make global business operations more open to losses in certain
areas of the supply chain.

Tariff trade barriers affecting their positions in multiple countries.

Increasingly lower prices for products amount their competitors.

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