CEO says running direct operation was just as expensive as a channel business

Dell admits to middleman myth

Michael Dell, the founder and CEO of Dell, has said that operating a reseller channel costs about the same as running a direct sales model.

The company, which had previously referred to resellers as unnecessary middlemen and frequently ran adverts claiming by cutting out the middleman, its products were cheaper, started working with partners earlier this year.

Dell told investors that its reseller channel was: "actively growing, signing up more partners and I think you’ll see that piece continue to grow.

"The mix of the partner business has been quite favourable so the operating margins of that business are relatively similar to the commercial direct business because of the mix of storage, servers and advanced products."

Source: Microscope

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