1. The brand name: Dell has a solid reputation for its brand and high-quality products. The brand’s value is around $ 7.5 billion.
2. Customization of the product: Dell allows its customers to personalize their laptops. This type of service was not initially available at any other major retailer for computers (and the only two currently allow it), Sony and Toshiba offer this) However, they provide great value to customers and provide Dell with a competitive edge.
3. Record of the environment: Dell is engaged in a variety of eco-friendly initiatives and has won numerous awards as an eco-friendly company. This is a plus when working with public or government agencies.
4. The ability to compete in mergers and acquisitions: Over the last five years, Dell has invested $13 billion on profitable mergers and acquisitions that brought patents, innovative capabilities, assets and expertise to the company.
5. Direct selling is a business model: Dell doesn’t sell its products through large-box stores, but instead sells directly to customers and businesses and keeps their already slim profit margin to their own customers.
Dell Weaknesses – Dell SWOT Analysis
1. Commodity items: The large stream of Dell’s revenue is derived from computer, specifically laptop sales, which is a commodity product. Hardware for computers (commodity) is sold at a small profit margin.
2. Poor customer service: Once praised, Dell’s customer service suffered due to the outsourcing of its call centers to offshore. Dell has invested a significant amount of money in repairing this issue, but it hasn’t recovered its former reputation for customer service.
3. A low investment for R&D: The company invests less of its profits on R&D than its main competitors and , as a result, missed the opportunity to create solid products for the smartphones and tablet users and also to develop new capabilities and skills.
4. A weak patents portfolio: Due to low expenditure on R&D Dell hasn’t accumulated the necessary patent portfolio and is finding it difficult to compete with highly lucrative markets for smartphones and tablets.
5. A lack of retail outlets: Selling products online can save money as well as allow for the customization of products, but it also reduces visibility of the products. Consumers find it difficult to believe the product when they can’t actually hold it by his hand.
6. A low degree of differentiated: Low price was the primary competitive advantage of Dell, however Dell is now capable of offering affordable prices. In addition to the price, Dell’s offerings are not distinguished from the products of rivals and they are at a disadvantage when prices offered by competitors is less.
Dell Opportunities – Dell SWOT Analysis
1. Expand Enterprise Solutions and services areas: Dell provides various services (cloud infrastructure, security and cloud) as well as enterprise solutions (servers and networking, as well as storage) and are Dell’s most profitable business right now. Dell business should concentrate on expanding these divisions since they can offer more growth opportunities as well as higher margins for profit.
2. Find more patents through the acquisition of other companies: If Dell wants to expand its reach, it requires new patents in technology and fresh concepts. Dell hasn’t established the R&D facilities to develop new patents and technologies and the only method to get patents and technology is to buy other businesses.
3. Enhance the presence of HTML0 on the market of emerging countries: Emerging economies are the fastest-growing market for laptops, tablets , and others electronic products. Dell is a strong player in these markets , but it needs to improve its standing in the face of declining market share.
4. Tablet market expansion: Tablet market is predicted to expand by double-digits over the next couple of years, and the company has an excellent chance to introduce new tablet models and profit from the growing market.
Dell Threats – Dell SWOT Analysis
1. The demand is growing for tablets and smartphones: With a lower cost and a significantly enhanced performance the majority of consumers prefer smartphones and tablets over laptops. The increasing demand for older devices takes a portion from laptops, which is the primary source of income for Dell.
2. Profit margins decrease for hardware products: Dell’s main income comes from the sale of hardware and their prices are expected to rise in the near future because of the rising cost of raw materials. This will result in higher costs for Dell and cut its profit margin.
3. Slowing growth rate of the laptop market: Growth rate of the market for computers is slowing and, in the near future, the market will be overcrowded. It will be difficult for Dell to compete in such a market, or even to regain the lost market share.
4. A fierce competition: The company faces an intense competition in all its segments of business. It is competing in terms of cost and quality, brand and technology, as well as reputation distribution, and the range of products. It competes with Acer, Apple, HP, IBM, Lenovo and Toshiba.
Dell SWOT Analysis Overview Template
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