Dell looks beyond the big Chinese cities for PC push

Dell, one of the top names in personal computers, is planning an aggressive expansion in smaller Chinese cities as the market grows despite a global trend toward smaller devices, a senior executive said this week.

The US-based company, facing uncertainty with a buyout bid by its founder Michael Dell, will add stores and product development in cities down to tier-six level on the mainland, Dell's computing products vice-president Kirk Schell said.

More presence in the mainland, which received 69 million PC shipments last year to become the world's largest consumer of the traditional computing tools, would boost Dell's odds against two other favourites, Hewlett-Packard and homegrown developer Lenovo. It would also complement China's quest to modernise its vast countryside.

Dell announced yesterday that it had opened a 30,000 square-metre factory in Chengdu with capacity for seven million desktops a year.

"We're opening a large number of storefronts in China so that more people will touch and feel our products," Schell said on the sidelines of the Computex Taipei technology show. "We need to get our hands on customers not only in both tier-one and tier-two cities but also the fourth to sixth, which are the big growth opportunities. So that's clearly a focus."

He declined to give a specific number of stores, expected revenues for Dell's growth in the country where it first invested in 1998 and every year buys about US$20 billion from supplier partners. Dell also would invest more in building devices especially for the mainland - in China - due to the country's "strategic importance", Schell said.