Dell sets sights on China's inland areas

Dell Inc, the second largest personal computer vendor in China, said it will expand into small cities as the nation pushes its urbanization drive.

“Some brands are doing well in big cities such as Beijing, Shanghai and Guangzhou, but they do not exist in the vast inland area where 63 percent of people are living in small cities, ” said Wang Lijun, head of Dell’s consumer electronics unit.

“Tier four to tier six cities will be the major battle field for us in the next year,” said Wang, who admitted that the company has yet to create a strong presence in China’s inland areas.

Earlier this year, the Texas-based company said it plans to double the number of retail stores in China over the next two to three years to build a stronger presence in less-developed inland areas.

The move is seen as a challenge to Lenovo Group Ltd, the largest computer vendor in the country.

Company founder and CEO Michael Dell is eyeing China as "the center" of his business and the most important market globally.

Although the global PC market has declined, commercial purchases of PCs in China was better than expected in the third quarter of this year, said research firm IDC.

Growing demand for lower-end PCs and tablets in small cities and rural areas has fueled Chinese purchases.

About half of China’s population lives in rural areas. That figure is expected to rise to 60 percent by 2020, according to government estimates.