Invacare 2005 Annual Report Download - page 6
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drive
downcosts
Invacare’sglobalsupplychainandlogistics
capabilityoffersanotherpathtocostsavings.
Wearenowseeingthebenefitsofopening
twofactoriesinChinain2004,which
complementedourexistingHongKong
sourcingoffice.
Invacarecurrentlysourcesormanufactures
$150millionworthofgoodsintheFarEast
withatargetof$400millioninthreetofive
years.CombinethatwiththeCompany’s
restructuringeffortsandInvacarehassaved
$25millionthroughtheseinitiativeswith
moretocome.
Wearealsoreducingfreightcostsin
partnershipwithourcustomersbyshipping
producttothemdirectfromthefactory.
Similarly,morethanhalfofourordersfor
disposableproductsarenowshippeddirectly
totheconsumerwiththeprovider’saddress
label.Thisreducescostsallaround,and
deliveryismadewithin24-48hours.
Action
P R O N T O ® M 5 1 ™- R P O W E R W H E E L C H A I R
Invacare’sglobalsupplychainandlogistics
capabilityoffersanotherpathtocostsavings.
Wearenowseeingthebenefitsofopening
twofactoriesinChinain2004,which
complementedourexistingHongKong
sourcingoffice.
Invacarecurrentlysourcesormanufactures
$150millionworthofgoodsintheFarEast
withatargetof$400millioninthreetofive
years.CombinethatwiththeCompany’s
restructuringeffortsandInvacarehassaved
$25millionthroughtheseinitiativeswith
moretocome.
Wearealsoreducingfreightcostsin
partnershipwithourcustomersbyshipping
producttothemdirectfromthefactory.
Similarly,morethanhalfofourordersfor
disposableproductsarenowshippeddirectly
totheconsumerwiththeprovider’saddress
label.Thisreducescostsallaround,and
deliveryismadewithin24-48hours.
Photos,toptobottom:InvacareI-Fit™ShowerChairs;
Value-LineRollator;manufacturingoxygenconcentrators
inChina;Tracer®SX5ManualWheelchair
Takingoutcostsandreducingthebreak-evenpoint
isacorporatemandate.Buttherestructuringgoes
deeperthanreducingheadcountandclosingfacilities.
ItinvolveschangingthewayInvacaredoesbusi-
nessinordertomaintainourleadershipposition.
Thismeansshiftingproductionofthemajorityof
stockitemstoourwhollyownedfacilitiesinChina.
ItalsomeansstructuringourlargestU.S.plant
toconcentrateonhigh-end,custom-configured,
made-to-orderwheelchairs.Fortheseproducts,
askilledworkforceandlocationnearthecustomer
representacompetitiveadvantage.
Wealsoareadjustingthefocusofourdesignand
developmentteam.Whiledevelopingnewand
innovativeproductsremainsapriority,engineering
thecostsoutofaproductisparamountto
Invacare’sstrategy.
Issue