Dude...you're getting a Dell....at Wal-Mart!!

[Lee]

From Yahoo:

SAN FRANCISCO/ BOSTON (Reuters) - Dell Inc. (Nasdaq:DELL - news) said on Thursday it plans to start selling personal computers through Wal-Mart Stores Inc. (NYSE:WMT - news) in North America next month, breaking from a 23-year model of direct sales as it tries to rekindle business.

Dell, which called the move a "first step" into the retail market, will start selling the computers bundled with accessories for under $700 starting June 10. Shares of Dell slipped along with computer component makers amid investor concern the low-priced PCs may squeeze profit margins.

Dell computers will be available in about 3,500 Wal-Mart and Sam's Club stores in the United States, Canada and Puerto Rico, a spokesman said. Dell and Wal-Mart declined to provide details on how the packages will be equipped.

The world's largest retailer will sell two models of Dell's Dimension multimedia desktop computer, which are now available directly from the computer maker.

"They (Dell) need to go retail and they are finally doing it," said Shaw Wu, an analyst with American Technology Research who has a "neutral" rating on Dell shares and does not own any.

Dell is expanding in retail stores to compete better with Hewlett-Packard Co. (NYSE:HPQ - news), which has overtaken Dell as the world's No. 1 PC maker, partly through a strategy of selling in the United States through major retailers such as Wal-Mart, Circuit City Stores Inc. (NYSE:CC - news) and Best Buy Co. Inc. (NYSE:BBY - news)

Dell shares closed down 37 cents, or 1.4 percent, at $25.89 after earlier gaining as much as 1.7 percent. U.S. stocks fell amid concern the U.S.
Federal Reserve may not cut interest rates this year.

The combination of Wal-Mart, famous for low prices, and Dell's Dimension desktops, the company's lowest-priced consumer models, may deter some upscale buyers, said J.P. Gownder, an industry analyst at market researcher Forrester Research Inc.

"This is a first foray into the world of retail" for Dell, Gownder said. "It's not a bad move. But in the long run, they'll want to establish a more-sophisticated retail strategy."

Since its founding in 1984, Dell has sold computers directly to customers through the mail, phone orders or the Internet. It has also sold some models in limited quantities through retailers including Costco Wholesale Corp. (Nasdaq:COST - news) and it showcases products in stores and mall kiosks where customers can order them for later home delivery.

Company founder Michael Dell, who retook the CEO job in January after sales growth slumped under predecessor Kevin Rollins, last month signaled that a retail push was in the works when he told employees in a memo that the direct-sales model was "not a religion."

"In the coming quarters, there will be additional activity in support of this move into global retail," said Dell spokesman Bob Pearson, declining to give further details. "Today's announcement with Wal-Mart represents our first step. Stay tuned."

Dell's retail expansion comes after Taiwan's Acer Inc. (2353.TW), the world's third-largest PC maker, began selling PCs at Best Buy, Circuit City and Wal-Mart.

China's Lenovo Group Ltd. (0992.HK) also said last month it planned a new consumer business unit as it faces stiff competition from HP, Dell and Acer.

Wal-Mart spokeswoman Melissa O'Brien said adding Dell computers is "part of a number of additions and enhancements that Wal-Mart is making in its electronics area." Wal-Mart plans to improve its brand selection in electronics, she added.

The Bentonville, Arkansas-based retailer has no "definitive strategy" at this time to sell Dell computers outside the United States, Canada and Puerto Rico, O'Brien said.

Dell's Pearson said the company plans to add additional retailers in its top 10 to 15 markets, including Britain, Germany, France, Japan, China, Brazil and Japan.

Dell's alliance with Wal-Mart may put pressure on computer- component makers to cut prices because both companies are known for extracting the lowest prices from suppliers, squeezing profit margins, analysts said.

Dell itself, which historically boasted some of the highest profit margins in an industry known for thin profits, will lose some of that advantage by embracing retailers, analysts said.

Shares of semiconductor makers fell sharply following news that the Dell systems would be priced below $700, less than Dell laptop computers and high-end systems that range from around $1,000 to more than $6,000 when fully configured.

"Wal-Mart is known for its very tight supply chain, and Dell is also very good at that," said Wu of American Technology Research.

At Dell, "margins are going to be tough," he added.

[Big Media]

Dell computers have fierce allegiances. You either swear by them or you swear they are crap. So... What say you?



Crap.

[Lester]

Swear by.

But my experience is with the Optiplex, Latitude, and Precision lines... which tend to be built better.

Here is a funny quote from a friend of mine that might work at Dell (or he/she might not. )

• Yeah, here's what I don't get:
  
  "There is a risk, Gownder said, that Dell's brand, not just its low-end Dimension desktops, becomes associated too strongly with Wal-Mart and its price-conscious image."
  
  Why the hell do we WANT to compete with E-Machines and the other POS boxes sold at that price point? Just to show we can make the cheapest POS pc? For pete's sake, who the hell thinks the Wal-Mart demographic is the most appealing, we at least should have shot for Target - would that be asking too much?
  
  Oh yeah, let's not look @ Apple and Sony w/ their nice higher end Apple and Sony Style stores, where they can actually sell high margin PC's like oh say the Alienware acquisition we had last year. Instead let's see if the dumbass who wants to plug a pc into his inverter in his RV he's parked in the WalMart parking lot for the past week will buy a Dell. Given our EXCELLENT customer support rating recently, I'm sure we'll do even better once Joe Dirt calls up Depak (oh I mean "Steve") in India b/c he's unable to hear the live stream from Nascar.com from the infield.
  
  Was that a rant? My bad.

[Arp2]

That's exactly the point I heard four analysts make yesterday -- if Dell is bent on going into existing retailers (not their own kiosks/stores), why didn't it go with higher-margin gaming and mission-critical-ish machines in better retailers??

[Dr. Whiplash]

TimesPostToday Biz News
16 June 2031

Googell made it official today, assimilating Wal-Mart into its global structure. The company also unveiled its much-awaited new name: Borg.

"We were looking for something light and easy to remember; something to remind the public that we are here to help," said Borg CEO Chelsea Clinton-Bush.

[AmpedNow]

I've never had a Dell, but I have friends who swear by them.

This is a great deal for Walmart, giving them more name brand merchandise to sell. But Dell does risk their brand being cheapened by being sold there.

Why the hell do we WANT to compete with E-Machines and the other POS boxes sold at that price point?

My first computer was an e-Machines... They're a great deal for computing newbies and low demand users, but I don't think I'll ever be getting another one.

[Arp2]

Heard on CNBC this morning.....


In its first weeks in Wal~Mart, Dell has completely sold out initial shipments, outselling HP 6:1 in the process.