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Dell’s biggest opportunity: Move into retail

Because of flagging PC sales reported worldwide it looks as if Michael Dell, founder and CEO of the company that bears his name, is going to be able to privatise and take Dell Inc. out of the stock market. He and equity firm Silver Lake Partners want to buy the company for $24.4 billion (£16 billion) to do so. One other bidder just dropped out because PC shipments are down 14 per cent in the first quarter. Another bidder, Carl Icahn, remains, but seriously – why would he want the company?

When Michael Dell regains total control of Dell, it means he can do as he pleases without worrying about public oversight and the never-ending battle to "beat estimates" quarter after quarter just to appease the stock market.

Will he do anything different? Should he do anything different? Obviously what he wants to do is rejig things in such a way that the company becomes a dynamo in one form or another, so he can repackage it for another future IPO which would net him billions.

Or he can just run the company forever.

Whatever the case he has to consider one possibility: Retail stores. Dell could do a tremendous job in direct retailing, exactly like Apple (and indeed Microsoft). While the main corporation can go off and do its services business, he should take the commodity products and show them off at a Dell Store. Many Dell products, especially its newer Ultrabooks, are stunning and would have tremendous appeal in a retail environment similar to an Apple store.

Yes, this has been tried by Dell before years ago, mainly with kiosks over in the US. Now things are different because of Apple's success, and especially because Ron Johnson – one of the brains behind the Apple Store who fled to JC Penney only to be recently ousted – is looking for work.

Johnson couldn't move fast enough for JC Penney, but may be perfect for Dell. He knows the retail start-up ropes. He can call on the same consultants behind much of the look and feel of the Apple stores. Right now Dell machines are scattered around various retail outlets and sold direct by the Dell online store. None of this is nearly as effective as a retail outlet run by Dell itself, where it can showcase the newest computers and explain how they work.

I've always believed that one key to success is controlling the sales pitch. With a third-party store selling a Dell, and an HP, and a Lenovo, the manufacturer is at the mercy of the retailer. Who knows what they are saying about the product? A manufacturer cannot afford to be at the mercy of someone else's sales pitch.

Ron Johnson is out there. It's time to grab him. Right after the buyback is complete.

If there is any concern, it would be over the look and feel of the store itself. Dell has never been a vendor anyone would call stylish. When the company bought Alienware, some believed Dell products would somehow become cooler looking than before. They didn't, and the humdrum look and feel of a Dell machine returned. That isn’t to say the company hasn't had its moments – look at the latest Dell Ultrabook. But it's not the norm for Dell.

That commodity styling in a retail environment would not work, and that would be where Ron Johnson comes in. He is the tasteful type of executive who likes things that look good. If nothing else he modernised the JC Penny logo to be something modern and stylish.

Whatever the case, Michael Dell will eventually own his own company again. Let's see if he can take it to the next level via retail stores. I certainly hope he can.