2. Dell
Dell has been the industry leader in direct
sale of PC to consumers.
Since its start
simplify its business for its customers.
huge range of products and services, which
can all be accessed by the consumers from
home or from the office very easily.
3. Supply chain management
Revolutionized the way people buy computers.
Markets its direct sales model.
No intermediaries
No warehousing
No physical store presence
Eliminated the need for central warehousing
Saves money and time.
Sales
Production
Warehousing
4. The supply chain of Dell includes
The customer
Dell’s website
Dell assembly plant
Dell’s suppliers
Their suppliers
5. Types of supply chain
Pull process (Reactive process)
Push process(Speculative process)
6. Process cycle of dell
Customer order and manufacturing cycle
–Pull Process
Procurement cycle –Push process
8. Distribution in Supply Chain
Distribution refers to steps taken to move
and store a product
From supplier stage to customer stage in
supply chain
11. Business Model
Combination of three things:
A. Direct Sales
B. Build to order
C. Supplier Integration
12. Direct Sales
A direct sales system allows DELL to:
Cut Costs
Develop exactly what customers want
Build relationships with customers
13. Build to Order
A build to order system allows DELL to:
Increase inventory velocity
Minimize inventory cost
Minimize the need for forecasting
Build exactly that its customer wants
14. Supplier Integration
Supplier integration allows DELL to
maximize the benefit of its other core
competencies
How?
Location of Supplier warehouses
Extranet
Meeting with suppliers
16. Postponement
Build-to-Order Strategy used
Product assembly begins after order received
from customer and credit cleared
Allows for customization. Results in shorter lead
time.
Dell has 3-4 days of finished inventory as
compared to 30-45 days for most of its
competitors
17. Modularity
Organization of complex products by
decomposing it into smaller portions that can be
managed independently.
Slots available within CPU casing to fit different
types of components from various suppliers
Large number of product variations possible
Also assists the reverse supply chain by ease in
breaking down components
18. Vendor Managed Inventory
Supplier to focus on part innovation and
Dell to concentrate on customers and
supply chain
Inventory replenished 3 times a week
Forecast information shared by Dell with
vendors to ensure timely supply
Inventory held in small warehouses near
Dell plants called “Revolvers”
19. Demand Management
Direct Selling enables real-time
collaboration and synchronization between
sales and manufacturing
Eg: When inventory for a component runs low,
Dell runs a promotion on another substitute part
of equal or greater quality. This helps shift
customer demand from standard ordering
patterns
20. Thank You !!
Alika Koshy
Ribhu Vashishtha
Aman Sawhney
Editor's Notes
Dell eliminated the need for central warehousing as well as the need for a physical store presence. Instead Dell attracts customers to its site and then builds bonds with them there rather than investing in a physical relationship.