Question

Milwaukee is a famous name in industrial quality power tools. Its products are renowned for their rugged design and reliability. Most of its products are sold through wholesalers (industrial distributors) to a wide variety of power tool users including factories, contractors, mechanics, schools, government agencies, and many others. Milwaukee claims that almost 80% of its distributors have been associated with it for 25 years or more. Milwaukee describes itself as a consistent and reliable partner to distributors. The company says, “Our business succeeds when your business succeeds.”

Comment on this statement in terms of its possible implications for channel design, selection, management, and evaluation strategies. Please explain in more detail.

Answer 1

The statement “Our business succeeds when your business succeeds” clearly shows that the organization has placed its trust on the channel members and has been successful in developing an effective channel which is responsible for attaining the desired objectives for the organization.

Based on this it is evident that the company is following a selective strategy wherein there are few quality channel members who are responsible for the entire sales for the products. The company has followed an effective channel strategy by choosing few very good channel members i.e. it is following a selective strategy. They have developed close relationship with them over the years and are also able to follow effective tactics which are capable of motivating them and thus these channel members are working in a way which helps the manufacturer to achieve its marketing objectives.

Company is also evaluating its channel members regularly to keep a check if any kind of modifications required motivating or any changes in product portfolio required so that the channel members objectives can be aligned with that of company and end users effectively.