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Dell delivers low-cost desktop PCs to China

Posted: 23 Mar 2007 ?? ?Print Version ?Bookmark and Share

Keywords:Dell? Dell desktop PC? low-cost PC? China market? China computer segment?

To sustain growth in China's computer segment, Dell Inc. unveiled a low-cost desktop PC targeting first-time buyers in the market, according to a Reuters report. Dell will sell its desktop PC for $335 to $520 to offer cost advantages over PCs in China that usually costs about $647.

According to chief executive Michael Dell, the company would be interested in rolling out similar models in other emerging markets, such as India and Brazil. "We're certainly going to look at other markets where it makes sense to bring our other products," Dell said in the report.

With a rapidly growing economy, China provides a promising market for vendors like Dell as more of the population can now afford electronic goods. The company will follow its direct sales business model which allows the company to deal directly with consumer and business customers. Analysts noted that the desktop launch in China comes as Dell zeroes in on consumers who traditionally prefer to see before they buy.

"Consumers are accustomed to buying things with cash, touching and feeling a product in a store and getting instant gratification, rather than calling into a call center or placing an order online and waiting a few days for the machine to arrive," said Bryan Ma, IDC research director, said in the report. He added that the direct-selling model remained a success with commercial buyers.

At present, Dell comes third to Lenovo Group Ltd and Founder Technology in terms of PC market shares in China. (See related article). Last year, over a third of PC sales in China went to consumers, while only 9 percent of Dell's shipments went to consumerslower than for most of its rivals, Ma added.

To further boost its capacity in the segment, the company plans to make acquisitions to expand its sales services business. In a separate report from Reuters, the company targets a 30 percent growth in production in terms of domestic sales in China thus, opening possibilities of a new Dell fab in China in three to four years.

Middle of 2006, Dell opened its second manufacturing facility in China. The 594,000-square-foot facility in Xiamen will reportedly double the company's production capacity in the region.




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