Dell, GOME to Sell PCs in China

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Monday, September 24, 2007

Dell, GOME to Sell PCs in China

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Dell said it would sell its latest range through China's largest electronics retailer, GOME Group, aiming to improve on its single-digit mainland market share.

The tie-up with GOME Electrical Appliances Holding Ltd follows similar moves in the United States by Dell to expand beyond its direct-sales model to increase sales and market share after losing the top-selling PC slot to Hewlett-Packard Co last year.

The China market is dominated by domestic giant Lenovo , whose 35 percent market share is nearly triple nearest rival HP's.

Dell would also have to deal with the problem of taking care of customers as it would need to train GOME employees to understand and sell Dell's product line.

Dell's move also demonstrates the rising competition in the global PC industry where Taiwan's Acer agreed to buy loss-making Gateway for $710 million last month.

Acer's move could push it past Lenovo as the world's No.3 PC maker and underscores the importance of scale in the highly competitive global computer industry.

Beijing-based GOME will start retailing Dell products next month in 50 of its stores. GOME has more than 700 outlets nationwide which sell computers.