Dell gets closer to retail deal in Asia

Dell Inc. is working on plans to sell PCs through retail stores in Asia and Australia, as part of a wider shift within the company away from using only direct sales.

Dell will add retail channels for PC sales in India, China, Australia and Japan, said T.R. Reid, a company spokesman. Dell will continue selling PCs directly to customers in these countries, which are the company’s most important markets in the Asia-Pacific region.

Reid did not say when retail PC sales would start in Asia, but indicated the company is talking to retail partners in the region. “There’s really strong interest on the part of potential partners,” he said.

The addition of retail sales represents a major strategy shift for Dell. The company pioneered the direct sales model during the 1990s, eschewing traditional PC sales channels for the Internet and telephone hotlines to become the world’s biggest PC vendor. Until recently, Dell executives repeatedly dismissed the idea that retail sales would help reach customers in countries like China, saying direct sales would suffice.

Dell’s long-standing aversion to retail sales ended this year with the return of Michael Dell as company CEO in January. In the face of a U.S. Securities and Exchange investigation into the company’s finances and sliding sales that toppled the company from its number-one spot, Dell has looked to reverse the company’s fortunes. Part of his strategy includes embracing the retail channel, which has proved instrumental in the recent strong performance of rivals such as Acer Inc. and Hewlett-Packard Co.

On June 10, the first Dell PCs went on sale with Wal-Mart Stores Inc. in the U.S. and Puerto Rico. The company is now selling two desktop PC models through Wal-Mart, both of which are priced under US$700, based on plans announced last month.

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