Dell- Alika Koshy

Aman Sawhney

Ribhu Vashishtha

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.

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

The supply chain of Dell includes

The customer Dell’s website Dell assembly plant Dell’s suppliers Their suppliers

Types of supply chain

Pull process (Reactive process) Push process(Speculative process)

Process cycle of dell

Customer order and manufacturing cycle –Pull Process

Procurement cycle –Push process

Drivers of supply chain

Facilities : Low facility cost Inventory:Low inventory costs Transportation:High transportation costs Information:high information cost

Distribution in Supply Chain

Distribution refers to steps taken to move and store a product

From supplier stage to customer stage in supply chain

Distribution network

Manufacturing storage with direct shipping

Distribution network

Manufacturing storage with direct shipping and intransit merge

Business Model

Combination of three things:

A. Direct Sales

B. Build to order

C. Supplier Integration

Direct Sales

A direct sales system allows DELL to:

Cut Costs

Develop exactly what customers want

Build relationships with customers

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

Supplier Integration

Supplier integration allows DELL to maximize the benefit of its other core competencies

How? Location of Supplier warehouses Extranet Meeting with suppliers

Supply Chain Techniques

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

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

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”

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

Thank You !!Alika KoshyRibhu VashishthaAman Sawhney