Topic 1 - My view on Dell’s Business model

The first topic I would like to write about is on Dell and why their Business model is so successful because of E-Business. As we all know Dell is a computer systems manufacturer who is currently the market leader in the PC Business. However it wasn’t all plain sailing for Dell in the beginning before the Internet had taken off. At that time Dell were losing $100 million due to taking orders by Fax and E-Mail was painfully slow back then. Dell were about to go Bankrupt.


The commercialization of the Internet in the early 1990’s allowed Dell with the opportunity to expand rapidly. Dell’s business model was significantly enhanced by the Internet which makes it easy for customers to contact Dell directly. Traditionally, all computer manufacturers sold their product through retailers, so therefore Dell decided to create a more cost-effective method of dealing with its customers by cutting out the middle man and sell directly to its customers. By selling directly to its customers it also saved Dell’s inventory costs by five percent which would have been paid to the retailers. I also found out those other companies such as Gateway and Compaq were coping Dell’s business and others were evaluating it.



Tailoring their computers to their customer’s specifications and selling them to their customers is what makes Dell’s business model so successful. Customers are more than willing to support a company that offers them flexibility and convenience. No longer is a customer restricted to a set offer that a retailer is offering. The ability to go online for the customer to get exactly what they want from a computer. In conclusion, Dell’s business model has ignited a spark which is not likely to be extinguished in the near future.