Dell to sell PCs in Indian retail outlets
Dell - the nearly $60 billion world’s second-largest maker of personal computers (PCs) - is planning to take the retail and channel partner route in India during CY2008.
The company, however, will continue with its direct-selling model in India in addition to retailing its products. The entry into retail is expected to ensure incremental business for the company.
Speaking on the sidelines of Infocom 2008 in Kolkata, Pallab Talukdar, director, enterprise business, Dell India, said: “So far, we were concentrating only on the direct-selling model via web and telephone in order to ensure a positive customer experience that we could control and customise. Now, we are looking at retailing our products and enterprise services too as we look at incremental business.”
In May 2007, Dell formed its first agreement to sell computers at retail outlets with Wal-Mart Stores, the world’s largest retailer, after founder Michael Dell built the company by shunning store shelves and selling directly to consumers via the web and telephone. The PC maker followed up by signing deals with Gome Electrical Appliances Holdings, China’s biggest electronics retailer, and Japan’s Bic Camera. It has also formed agreements with retailers in Singapore and South Korea.
This is a significant strategic shift, ostensibly prompted by founder Michael Dell’s return to the company early this year. Trying to gain back some of the momentum it lost to Hewlett Packard globally, the retail channel is seen as one logical way to grow sales. In this context, the country is a huge market. Dell expects revenues from the country to double, touching the $1 billion mark (around Rs 4,000 crore) from the current Rs 2,500 crore by 2008-09.
The company is also planning to start manufacturing laptops at its plant in Tamil Nadu within the next three months. “We will soon manufacture our entire portfolio of notebooks at the Tamil Nadu plant,” Talukdar said.
Set up six months ago with an investment of close to $50 million, the plant currently manufactures desktops. In the last six months, the plant has already manufactured one lakh desktops.
It has been importing PCs from its overseas facility in Penang in Malaysia and China to cater to the domestic PC market. Typically, it takes 12-15 days to ship PCs to the country. It now expects to reduce the lead time for delivering a PC to customers by 50% besides saving on air freight and import duty.
