Dell Selling Factories?

Dell Inc. (NASDAQ:DELL), one of the largest desktop PC makers in the world, has become desperate to sell its factories around the world.

The decision comes in the face of adopting a new business model under which the PC giant will place orders to contract manufacturers. Till now, the company was following an “after order manufacturing system.” The company will go into manufacturing only after any party place orders. This system proved to be effective because it reduced cost and idle inventory. Now, things changed a lot. Once, the company which made an attractive amount of profit and took pride in its “benchmark manufacturing system,” reported very low quarterly profit which resulted into its share prices going down by 18%.

Now, Michael Dell back as chief executive, the company is gearing up for a new business strategy under which it would sell its factories to “contract computer manufacturers.” HP (NYSE:HPQ), one of the major rivals of Dell took over the top position in terms of market share adopting such strategy.

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