Dell eyes smaller China cities

[photopress:It_dell_in_smaller_cities.jpg,full,alignright]Dell is struggling in China. Indeed, it has slipped around the world with Hewlett-Packard taking up the slack and, Acer, if you count all its take-over brands, moving into second place. Dell has just reported lower-than-expected quarterly profit margins and warned that rising costs could depress future results, sending its shares down 10%.

On the other hand Dell has just posted unit growth for its third fiscal quarter of 26% in China, 30% in Brazil and 42% in India.

Dell’s current retail partner in China is GOME electrical and home department stores.

Dell is now starting to focus on lower-tier cities and this will include lower-priced products although there is unlikely to be a dramatic shift in Dell’s average price.

Dell is not just selling PCs through Gome in China. It has reversed its marketing policy and is now selling PCs at Wal-Mart Stores in the United States, GOME in China and has announced will also now start to sell thorugh Carrefour which is in France, Spain, Belgium and Thailand and is the world’s second-largest retailer.

What has led it to this is the slow-down in its direct sales model. This despite the fact that in many countries it is still the least expensive way of buying a good class computer.
Source: Yahoo News