The company Sunshine GmbH manufactures alternative heating systems. It has recently secured the patent for a revolutionary heating technology developed in Scandinavia that consumes only one-fifth of the energy required by conventional systems. Management is now considering the most effective way to market this new product, branded “Skandisun.”

a.    The first step in selecting the right distribution channels requires a careful analysis of the product, the producer (company), the market, and the competitive environment. Which considerations should the firm reflect in each of these areas when choosing the most suitable distribution channels?

b.    Next, the firm must determine the appropriate distribution channels for Skandisun. This involves defining both the vertical and horizontal structure of the sales channel (Do not mix this with vertical/horizontal marketing systems). What do these concepts mean in this context?

c.     The discussion initially focuses on the option of direct sales for Skandisun. What would direct sales involve in this case, and what advantages and disadvantages would this approach present for Sunshine GmbH?

d.    As an alternative to direct sales, indirect distribution is being considered for Skandisun. In this context, management is debating whether distribution should occur via retailers or (also) via wholesalers. What are the advantages and disadvantages of these indirect distribution options?

e.    Another option under discussion is the use of a multi-channel distribution system for Skandisun. What would a multi-channel approach entail for this product?

f.      Which evaluation and assessment methods can be used to assess the suitability of the different distribution system alternatives?