Stihl Inc. Case Study

Stihl Case Study

Yuexiu Wang

(44943261)

Peter Burton and his staff were celebrating their company’s success over the last two years. By 2008, growth had slowed and financial had wreaked. Would Stihl’s dealer reliance strategy continue to make sense?

In 1974, Andrea Stihl opened its US marketing and manufacturing subsidiary Stihl Inc. By 2008 Stihl had one million square feet of fabrication, warehousing, and administration space. Stihl used a two-step channel system to go to market: twelve geographically separate wholesale distributors and independent retailer network Stihl invested a lot of money and expertise to its channel partners to help them built, enlarge and remodeled their operations and showrooms. Stihl’s product category includes chain saws, hedge trimmers, edgers, brush cutters, leaf blowers, vacuums, pruners and sprayers. These varied products fall into three categories: Handheld tools, outdoor tools, and power tools. Weather and season are the two main factors in product purchasing. Environmentally friendly goods had gained strongest trend in product development. Product price is based on makes, models, and brands. Echo and Husqvarna are the two main competitors.

Distribution channels: Hardware stores, home improve centres, mass merchants, independent specialty stores and online retailers; Hybrid channels combining physical stores with online order centres capabilities with no distinction in between. Stihl focus on two main categories of buyers: commercial and consumer. Primary target is home owners. Major distribution issue is consumers were not receiving top service and support, as well as the economic slump. In conclusion, multi-channel system appears more suitable to market needs and Stihl corporate objectives.