Dells Supply Chain Management - 2081 Words

Direct Sales and Build-to-Order Model: Dell’s computers, workstations, and servers are built-to-order and none are produced for inventory purposes which clearly cuts Dell’s cost on inventory. Dell customers could order through their website or even via phone, custom-made servers and workstations based on the needs of their applications. For desktop and laptop, customers are able to order whatever configuration of microprocessor speed, random access memory (RAM), hard-disk capacity, CD-ROM drive, fax/modem, monitor size, speakers, and other accessories they favored. The orders will then be directed to the nearest factory. Dell has proven to be successful in minimizing inventory and bringing new products in the market quickly enabling them†¦show more content†¦In Dell’s website, there is also an interface called the ‘premier page’ for corporate customers to facilitate B2B or Business to Business sales and to separate them from the personal use customers. The interface is designed for purchasing manager or whoever is in charge to log on and place an order. This interface is also customized according to the company’s needs. The bullwhip effect is also being reduced as a result of Dell’s direct sales model. Dell contracts special web pages for suppliers, allowing them to view orders for components they produce when a customer orders them through Dell’s website. This will give suppliers the advantage and the possibility to plan based on customers demand. This also allows Dell to achieve substantial unit cost advantage. Dell is able to minimize rapid depreciation and inventory write-off costs by its direct sales model. Through Dell’s direct sales model, Dell is able to collect payment in 5 days on average after a product is being sold. However, Dell still continues to pay their supplier according to the traditional billing schedule as when it comes to money, the traditional way of billing, invoici ng and etc is still preferable. Inventory is low and is negative in Dell’s working capital, thus, making able for Dell to concentrate on increasing its performance. Q3. What are the main disadvantages of Dell’s direct sales model? The most remarkable thing about Dell is its direct sales model. AShow MoreRelatedDells Supply Chain Management1882 Words   |  8 PagesDell’s Supply Chain Management      Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   The term supply chain management (SCM) was initially used in wholesaling and retailing to denote the integration of logistics and physical distribution functions with the goal of reducing delivery lead times. Manufacturers and service providers have used the same term to describe integration and partnership efforts with first- and second- tier suppliers to reduce cost and improve quality and delivery timing. Terms such as integrated purchasing strategyRead MoreRelationship Management Strategies in Dells Supply Chain5443 Words   |  22 Pagesusing the multinational corporation Dell, Inc, existing and suggested Relationship Management Strategies applied to both Upstream and Downstream members of a supply chain. It also examines and gives an analysis of, using several diagrams, tables and models, Dell’s product range – and the customers who buy them. This paper also examines several Key Issues associated with maintaining positive relationships with supply chain members, and how they may be worked out, besides providing an in-depth analysisRead MoreIntroduction to Supply Chain Management System: Dell Computer Corporation1451 Words   |  6 PagesIntroduction to Supply Chain Management (SCM) System Supply chain management (SCM) is the combination of activities which help a company to improve the methods to make a product or service and deliver it to customers. 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Dell is able to achieve superior profits in the industry because they are a knowledgeable user of information, communication, e-commerce, e-business, internet, and web technologies. Michael Dell states that Dell is so successful because ofRead MoreFord Motor Case Study1291 Words   |  6 PagesExecutive Summary: Ford wanted to adapt the idea of virtual integration to improve its supply chain. By the use of technology; it wanted to reduce its working capital and increase profits. Moreover, the company was emphasizing more and more on shareholder value and customer responsiveness so they were looking into reengineering some of their processes which can help improve their current forecasting model and reduce OTD cycle times substantially. With new business models prevailing, Ford did notRead Moredell supply chain managment1676 Words   |  7 PagesCourse: Supply Chain Management (SCM) Assignment One – Singular Unit Supply Chain Management Subject HOW DELL IS MANAGING ITS SUPPLY CHAIN Writer Bassam Badran IV Date of delivery 10-10-2012 Due date (submittal) 10-11-2012 Grade 20% References Compiled from several articles in Business Week (1997 through 2001); cio.com (2001); dell.com, accessed March 27, 2003; Hagel (2002). 1. 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Ford’s hallmark of achievement proved to be a key competence for the motor company as the low cost of the Model T attracted a broader, new range of prospective car-owners. However, after many decades of success, customers have become harder to find. Due to relatively new threats to the industry, increasing numbers of