DALLAS (AP) - Dell Inc. will expand its presence in China by selling
desktop and notebook computers at Suning, the country's second-largest
electronics chain, and doubling the number of Gome stores that carry Dell
machines.
Those moves, plus selling PCs through several smaller retailers in China,
will put Dell products on the shelves of more than 12,000 stores worldwide.
Dell is trying to regain the lead in worldwide PC shipments by branching out
from its phone and Internet sales and going into retail stores. The strategy may
be paying off.
Two technology research firms, IDC and Gartner Inc., reported Wednesday that
Dell still trails Hewlett-Packard Co. in worldwide shipments but gained ground
in the first quarter.
H-P says its machines are available in more than 81,000 stores.
In China, Dell is also competing with domestic market leader Lenovo Group.
Dell started selling machines at Gome, China's largest electronics chain,
last year. Michael Tatelman, general manager of Dell's global consumer business,
declined to give sales numbers but said the arrangement is working well enough
to double it to 900 Gome stores this month.
With Gome and Suning, "These guys are the premium two, and they are pretty
expansive, not only across the big cities but down into smaller cities as well,"
Tatelman said.
Dell believes that young Chinese consumers buying their first computer will
prefer the superstore format of larger Gome and Suning locations to the
country's hectic PC malls.
China is an increasingly important market to Dell. In its fiscal fourth
quarter, Dell said, sales in the Asia-Pacific and Japan region rose 28 percent,
offsetting more modest gains elsewhere.
There are downsides, however, to the retail approach. Although Dell doesn't
break out figures, analysts say the company must share revenue with the
retailers instead of keeping it all, as it does with its direct phone and
Internet sales.
Dell also will increase spending for online marketing and in-store
promotions at Gome and Suning, Tatelman said.
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