Sunday, February 8, 2009

An example of an E-commerce failure and its causes

Posted by memories

Dell Computer Corporation is one of the largest firms consisting of approximately 30,000 employees. They are located throughout the United States, containing high top quality supplies and security services.

Dell’s success over the years has caused concern for the future of the young company. Dell’s business-to-business (B2B) exchange failed for a number of reasons. The primary reason is the lack of insight in the research and development area. A lack of knowledge in this area proved to be detrimental because the company was unprepared for the lack of cooperation that other businesses showed in this new idea.

Even though the business-to-business sounded like a great new opportunity, Dell jumped too quickly at the new idea. The computer industry is extremely competitive with several B2B exchanges taking place on the Web; only the strongest will survive.
Another downfall may have been due to Dell’s choice of suppliers. 3M, Motorola, and Pitney Bowes are second-rate firms compared to companies such as Compaq, Hewlett-Packard and Gateway.

Beginning the business in October 2000 and ending in January 2001 gave them only a short time frame to produce a profit. Luckily Dell is a strong company and was able to survive after the loss. With the future of the B2B commerce looking very bright, it would be a good idea for Dell to continue on this project with an optimistic outlook.

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