Dell taking LatAm PC market by storm

With its direct approach to sales and services and an aggressive focus on large accounts, Dell Computer Corp. has, in four years, gone from a minor player to a leader in Latin America’s PC market.

In the second quarter of 1998, Dell shipped 2.1 per cent of all PCs in Latin America, a market share that climbed to 5.7 per cent in 2002’s second quarter, according to Gartner Inc.’s Dataquest unit.

That put Dell in third place in terms of shipments, far behind market leader Hewlett-Packard Co. (13.9 per cent) but close to IBM Corp., which shipped 6 per cent of PCs during the quarter, according to Dataquest.

Even more significant is that Dell is increasing its shipments robustly in a market that’s declining. Dell’s shipments rose 31 per cent during the second quarter, while total shipments fell 8.3 per cent, Dataquest said. IBM’s shipments remained flat while HP’s took a 50 per cent drop, Dataquest said. In the first quarter, Dell’s growth in shipments was even more dramatic, 63 per cent, while total shipments fell almost 3 per cent.

According to Peter Wiegandt, vice president for Dell Latin America, there is no secret to the company’s performance in the region: The market is just responding to Dell’s direct sales model. Dell creates direct relations with its clients, tailors its products and services to clients’ requests and delivers its offerings quickly at low prices, he said. Wiegandt does not believe that there is a need for Dell to create a reseller chain or any other kind of intermediary distribution channel in Latin America.

Part of Dell’s strategy is to establish a trend of low prices for the region and go after big customers, said Luis Anavitarte, Dataquest’s vice president and research director for Latin America. “At this moment they want (to achieve) a good position in the market and therefore are more interested in sales than in profits. They want to conquer a significant per centage of the market share, and to reach that goal they are clearly focused on the large enterprises of Brazil and M

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Jim Love, Chief Content Officer, IT World Canada

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