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DELL'S Competitive Advantage In Logistics And Distribution

2010/9/29 17:37:00 571

DELL Is Strong And Flexible In Managing Information Systems.

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DELL

In fact, there has been widespread controversy in the industry and academia. Most of the disputes are focused on the operation level of its direct selling, especially in China, which is suspected to exist in the dark channels of "fake direct selling and genuine agency". However, from the perspective of its strategy, DELL mode has really won the competitive advantage that it can not be duplicated.

Traditional PC vendors sell their computers to consumers through a wholesaler - Dealer - retailer, a distribution chain with a large number of intermediate links.

In this typical distribution mode, manufacturers, wholesalers, distributors and retailers have product inventories, and maintaining these inventories brings huge costs to the entire distribution chain.

The sales mode of DELL is different from that of direct selling through its website.

Consumers only need to log on to DELL's website, configure their computers according to their needs, decide to enter their credit card numbers and complete the order process, so that they can receive the desired computers within a few days.

DELL has saved about 20% of its cost by eliminating a large number of intermediate sales links, and the effective logistics distribution mode jointly established with partners also helped DELL reduce its cost substantially.

All of these make the strategy of low price sale smoothly carry out, and remain invincible in the competitive PC market.

And DELL's series of models that help reduce costs depend on them.

Strong and flexible management information system

As a support.

DELL's success has attracted many competitors' imitation of its direct selling mode.

IBM, Compaq, Lenovo and other PC manufacturing giants have tried different ways to this brand new way of operation, but the effect is not ideal.

In fact, both direct selling mode and IT system are only methods and means, and the key is to benefit from management.

It is not difficult to describe the pattern of DELL in language, and the most difficult part is execution.

The supply and assembly operation system of DELL based on direct selling mode is a low-cost mode of simplifying channel consumption and low inventory, which is directly faced with terminal consumers through any channel.

Its core competitiveness lies in using the management information system as a means to achieve the goal of low cost for the organization and operation of direct selling.

The conflict between distribution, service and old sales mode has become the reason why DELL mode is hard to imitate.

When DELL set up factories in Xiamen in August 1998, it copied the direct sales mode to China.

Direct selling should set up a complete system including factories, databases, logistics and networks. If other companies pform direct selling, they must subvert the original production system, sales system and logistics system, resulting in structural reorganization of the entire supply chain and redistribution of interests, thereby greatly stimulating the interests of suppliers and distributors. This will encounter unimaginable resistance.

As DELL's former vice president and China's president Li Shu Shu said, "it is not easy for other companies to pform, because a lot of things can not be changed unless they do it at the very beginning.