Distribution Channels

       Once the potential market targets for a new product have been identified, consideration should be given to identifying the types of outlets where the product could potentially be distributed to those market targets. In this section, we will identify potential channels of distribution for "M.C. WARNING DEVICE". However, there is absolutely no way that anyone can project with any accuracy the number of distribution outlets which might actually handle any given product.

        In obtaining the number of outlets for a particular distribution channel, we utilize information from the Economic Census conducted by the Census Bureau, an agency within the U.S. Department of Commerce, as our primary source.

       The following channels represent potential outlets where "M. C. WARNING DEVICE" could be distributed:

Merchant Wholesalers of Medical & Hospital Equipment & Supplies (with employees): 6,637

Agents, Brokers, and Commission Merchants of Medical and Hospital Equipment and Surgical Supplies (with employees): 1,177

Of particular interest within some general categories already suggested could be these more specialized potential outlets (as counted by a major business list firm):

Retailers of Home Health Care Equipment & Supplies: 2,829

Direct Business-to-Business Sales

Just as "M. C. WARNING DEVICE" could be purchased by consumers through non-store channels, the commercial market could be accessed by multichannel direct marketing initiatives directed toward business owners, managers, and purchasing executives. Perhaps even more than for consumer purchasers, business customers are drawn to using the Internet to research prices and vendors for

the products they need. In the past, business-to-business (B2B) direct marketing

tactics included traditional marketing proposals, and business executives were very engaged readers of any B2B media, general business magazines, television, newspapers, printed catalogs, or direct mail. However, many executives, business aders, and decision makers have embraced mobile communications access and ognize the capabilities these mobile devices have on their day-to-day business operations

Within the scope of this Basic Information Package report, even the best efforts can result in deriving only rough approximations for the positioning of selling price, corresponding distributor channel markups, and potential manufacturing

costs.

For working purposes in preparing this Information Summary, however, we

project an estimated pricing structure as follows:

Manufacturing Cost:

$ 70.00 to $ 90.00 per unit

Wholesale Price:

$100.00 to $150.00 per unit

Sales Price:

$150.00 to $250.00 per unit

Of course, production in various sizes and the use of varied materials and

processes would suggest corresponding variations in this estimated pricing structure.

A wide range of factors influence the selling price, distribution channels

markups, and unit cost of a product.