Top Direct-selling Computer Maker Won’t Adopt Same Strategy in RP
Newest Dell Consumer Contact Center Opens at the SM Mall of Asia
By Melvin G. Calimag

Dell Computers, Inc., which built its fortune as the world’s top computer maker by selling its products directly to customers, has no intention of implementing the same marketing model in the Philippines.

This was disclosed by Michael Dell himself, the company’s founder and chairman, when he first visited the country for the first time last March 21 to help inaugurate the computer maker’s newest call center at the SM Mall of Asia.

“We have great business here with our five business partners. We don’t have plans of changing that strategy,” said Dell, without elaborating, during a short question-and-answer session with members of the local media.

Instead of adopting the direct-selling approach made famous by the company, Dell Inc., has taken a different tack in the Philippines by relegating the PC-retailing function to third-party local resellers MDI, Accent Micro, Nexus, PhilData, and ICS.

An official of the company’s local subsidiary, however, said the case of the Philippines is not unique. “There are a lot of countries [where Dell is present] that also does not use the direct business model,” said Chris Magallona, business development manager at the Philippine Representative Office of Dell Inc.

In the Southeast Asian region, only Brunei, Malaysia, Singapore, and Thailand have direct sales operations.

The Philippines belongs to a list the company calls “Dell Indirect Countries.”

The company, founded in 1984 in a dormitory by then-university student Michael Dell, takes pride in its marketing model. In its website, it declares, “The company is based on a simple concept: by selling computer systems directly to customers, Dell could best understand their needs . . . this direct –business model eliminates retailers that add unnecessary time and cost, or can diminish Dell’s understanding of customer expectations.”

Since it transacts directly with customers, the company’s call centers cater exclusively to Dell clients. The facility in Pasay, constructed at an undisclosed amount, is Dell’s second contact center in Southeast Asia after Penang, Malaysia.

During the launch of the call center, which had President Gloria Macapagal-Arroyo as main guest, Dell announced that the company plans to double the 700 initial jobs that it originally expected, bringing its projected employment to about 1,400 people. A source, however, said the figure may rise up to 3,000.

The 145,000-square-foot contact center in the soon-to-be-opened SM Mall of Asia has seven training areas, four technology demonstration labs, Internet-connected lounge areas, and a library for employee use.

The Pasay site is Dell’s second facility to open in Metro Manila in the last five months. The company launched a 17-square-foot recruiting and training facility at the RCBC Tower in Makati City last October.

Asked whether Dell Inc. has plans to put up a manufacturing facility in the country, the company’s founder said it will still evaluate the opportunities offered by the Philippines but sounded noncommittal about the possibility of setting up a local plant.

Dell Inc. operates two large manufacturing facilities in Penang, Malaysia; the first one opened in 1995 and the second in 2001. Dubbed as Asia-Pacific Customer Centers, these factories manufacture made-to-order hardware products for the whole Asia-Pacific region, except China.

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Originally published in the Manila Bulletin on Friday, March 24, 2006. Reprinted with permission.