Dell showed further signs of toppling Compaq from its number one slot in the PC market today as it announced exceptional second quarter results.
The company turned over $2.8 billion with net profits of $214 million, a huge increase year on year. In the same quarter last year, turnover was $1.7 billion with net profits of $103 million.
While Europe was somewhat sluggish for other PC vendors, Dell managed to increase its sales by 42 per cent. Dell?s sales in the Asia-Pacific region grew by 90 per cent.
Said Adrian Weekes, managing director of the corporate division of Dell UK: ?The secret of Dell?s success is leading price/performance, speed to market and being a direct supplier across the world.?
He said Dell had managed to cut down its time to market from 14 days to 11 days, and was able to buy its components for 35 per cent less than most rivals because of its size.
Dell?s goal was to topple Compaq from its number one slot, said Weekes. ?The Compaq indirect model is typically loaded with costs,? he said. ?We take out the mark-up a reseller has to make in order to service the customer. In the UK we?re number two and Compaq is the market leader.?
Companies like Gateway, which had emulated Dell?s model, were not a threat, said Weekes. ?We do see Gateway and others emulating what we?re doing but we haven?t sacrificed the profitability of the company in driving growth.?
Companies like Compaq, which took out pages in the nationals today selling PCs on hire purchase, and others that have plans to introduce Internet sites, have a way to catch up. He said: ?When we look at people trying to emulate us, we don?t see that they have the same story.?
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