Dell Inc. in an attempt to gain penetration in the Chinese market decided to augment its direct sales channel model with indirect retail store channels. Two desk tops and two laptops both low priced and specially designed for emerging markets will be sold through 2700 Gome and Suning consumer electronics stores not only in Beijing and Shanghai and other large cities but in smaller cities as well. Dell believes that the Chinese market is growing so fast that its traditional direct sales channel structure would not be able to keep up with the rapidly growing demand for personal computers in China. By relying on Chinese retailers, Dell hopes to provide many more touch points for Chinese consumers to gain access to Dell computers. Do you agree with Dell’s strategy? Why or why not? What pitfalls might this strategy encounter?
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