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Dell was also having trouble with their direct sales model, which led to complaints about slow delivery, service and support. Overall the industry began so see dramatic decreases in profit margins in the low-priced consumer sector.
In order for Dell to profit in the Chinese computer vendor market it must be competitive in the low-priced consumer market, high-end consumer market, and corporate market. Dell would not be able to compete in all markets with its current resources and capabilities. So it must joint venture with Compaq to utilize one another’s resources and competencies. Compaq is the world leader in PC sales and is currently fifth in the Chinese market...
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