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 user 2005-04-14 at 10:37:00 am Views: 37
  • #8856

    Printing to help Dell hit $80bn in revenue

    Dell plans to build on its relatively new businesses in IT services and
    printing in order to increase its yearly revenue to $80 billion over the next
    few years, Dell executives and customers said Wednesday.

    Dell plans to formally unveil its $80 billion strategy Thursday at its
    analyst meeting in Texas. The company hopes to generate that amount of yearly
    revenue within the next three to four years, Dell Chief Executive Officer Kevin
    Rollins said in a press release Wednesday.

    In 2002, Dell set a $60 billion yearly revenue target, and the company
    announced earlier this year that it expects to reach that figure during the
    current fiscal year, which will end in January 2006. The company has rarely
    missed an earnings target since the 2002 announcement, and the first quarter of
    this fiscal year will be no different, Dell said in the release. The company
    expects to meet the guidance it issued in February for first-quarter revenue of
    $13.4 billion and earnings per share of $0.37 when it reports its earnings on
    May 12.

    In order to reach the next target, lesser-known Dell businesses such as
    printing and services will have to continue to grow, executives said Wednesday
    during briefings for press and analysts ahead of Thursday’s meeting.

    Dell is especially focused on sales of printer ink and toner, also known as
    “consumables,” said Ro Parra, senior vice president for Dell Americas. Dell has
    an opportunity to capture more of the printer market because of how it delivers
    replacement ink or toner cartridges to customers, he said.

    Home printer users have been trained to look for new ink cartridges in retail
    stores, which can be a frustrating game of “ink cartridge bingo,” Parra said.
    Dell allows customers to track the ink levels remaining in their cartridges and
    order new cartridges online by clicking on a link within a print management
    software application.

    Dell thinks customers will appreciate an easier method of buying replacement
    ink or toner than trolling the aisles of retail stores, Parra said. Dell printer
    executives did not directly address the issue of third-party replacement
    cartridges, which usually cost less than cartridges sold by printer vendors, but
    analysts believe the company also hopes its ink-replacement system will dissuade
    customers from buying their ink elsewhere.