Stihl is the world’s leading manufacturer and marketer of chain saws with annual

Question

Stihl is the world’s leading manufacturer and marketer of chain saws with annual sales exceeding $3.7 billion. With innovations dating to its 1929 invention of the gasoline-powered chain saw, the company holds more than 1,000 patents related to chain saws and outdoor power tools. The company’s chain saws, leaf blowers, and hedge trimmers sell at price points well above competing brands and are sold only by its network of 40,000 independent dealers in more than 160 countries.

How would you characterize Stihl’s competitive strategy?    Should it be classified as a low-cost provider strategy? a differentiation strategy? a best-cost strategy? Also, has the company chosen to focus on a narrow piece of the market or does it appear to pursue a broad market approach? Explain your answer.

Explanation / Answer

Stihl's competitive strategy can be classified as Differentiation strategy as its products are mostly patented and sell for higher prices compared to competing brands. Also, the products are sold only by its 40000 independent dealers network in more than 160 countries.

The firm focuces on broad market approach considering its sales in more than 160 countries and the widespread dealer network.

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