The Financial Analysis of Dell Inc Essay Example | Topics and Well Written Essays - 500 words

The Financial Analysis of Dell Inc - Essay Example Because of the aforementioned strengths, the company has made a name in the computer industry and secured a significant portion of the global market share. The company also enjoys strong brand equity. Acquisition of financing is relatively easier as the company’s stock has a higher market value. With its commitment to excellence and bright industry prospects, I believe that the company will be able to sustain these strengths in the further.One of the major weaknesses of Dell is its lack of proprietary technology in its production activities. Some experts refer to Dell as a computer maker and not a computer manufacturer. As Dell purchases, semi-assembled inputs in its production, bargaining power is tilted to suppliers. Dell’s heavy dependency on suppliers also exposes it to risk faced by them. Dell’s high utilization of long-term debt in financing its assets may make its investors reluctant in purchasing its stocks. The company can overcome these weaknesses by in vesting more in research and development. Strategic partnerships should also be strengthened and company should be able to manage its cost more efficiently. I am very much optimistic about the future of Dell, Inc. The rapid technological advancement and growing importance of computing devices assure the business organization with a sure market. It should also be noted that the online business model exclusively employed by Dell will surely be patronized as the level of internet penetration in the world increases sharply.... Strengths and Weaknesses The major strength of Dell, Inc. is its utilization of a business model which enables it to reap various benefits which are not enjoyed by its competitors. The direct business cut a significant amount of cost in the company's supply chain by eliminating the less value adding activities. Inventories were kept low and technological breakthroughs are delivered to the customer within a week opposed to industry's average of two months. The direct business model also enabled the company to market directly to the buyers, thereby offering more customized products. Another is Dell's cost leadership strategy. As the company is able to produce computers with the least possible cost, the company is also able to charge lower prices to customers relative to its competitors. Because of the aforementioned strengths, the company has made a name in the computer industry and secured a significant portion of the global market share. The company also enjoys strong brand equity. Acquisition of financing i s relatively easier as the company's stock has a higher market value. With its commitment for excellence and bright industry prospects, I believe that the company will be able to sustain these strengths in the further. One of the major weaknesses of Dell is its lack of proprietary technology in its production activities. Some experts refer to Dell as a computer maker and not a computer manufacturer. Another is Dell's high dependence on its suppliers. As Dell purchases semi-assembled inputs in its production, bargaining power is tilted to suppliers. Dell's heavy dependency on suppliers also exposes it to risk faced by them. Dell's high utilization of long term dent in financing its assets may make its investors reluctant in purchasing its stocks. The