Audiovox 2010 Annual Report Download - page 12

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We have flexible shipping policies designed to meet customer needs. In the absence of specific customer instructions, we
ship products within 24 to 48 hours from the receipt of an order from public warehouses and leased facilities throughout the United
States, Canada, Mexico, Venezuela and Germany.
Product Development, Warranty and Customer Service
Our product development cycle includes:
• identifying consumer trends and potential demand,
• responding to those trends through product design and feature integration, which includes software design, electrical
engineering, industrial design and pre-production testing. In the case of OEM customers, the product development cycle
may also include product validation to customer quality standards, and
• evaluating and testing new products in our own facilities to ensure compliance with our design specifications and
standards.
Utilizing our company-owned and third party facilities in the United States, Europe and Asia, we work closely with
customers and suppliers throughout the product design, testing and development process in an effort to meet the expectations of
consumer demand for technologically-advanced and high quality products. Our Hauppauge, New York and Troy, Michigan facilities
are ISO 14001:2004 and/or ISO/TS 16949:2002 certified, which requires the monitoring of quality standards in all facets of business.
We are committed to providing product warranties for all our product lines, which generally range from 90 days up to the life
of the vehicle for the original owner on some automobile-installed products. To support our warranties, we have independent warranty
centers throughout the United States, Canada, Mexico, Central America, Puerto Rico, Europe and Venezuela. Our customer service
group along with our Company websites, provide product information, answer questions and serve as technical hotlines for installation
help for end-users and customers.
Suppliers
We work directly with our suppliers on industrial design, feature sets, product development and testing in order to ensure that
our products are manufactured to our design specifications.
We purchase our products from manufacturers principally located in several Pacific Rim countries, including China, Hong
Kong, Indonesia, Malaysia, South Korea, Taiwan and Singapore, as well as the United States, Canada and Mexico. In selecting our
manufacturers, we consider quality, price, service, reputation and financial stability. In order to provide coordination and supervision
of supplier performance such as price negotiations, delivery and quality control, we maintain buying and inspection offices in China
and Hong Kong. We consider relations with our suppliers to be good and alternative sources of supply are generally available within
120 days. We do not have long-term contracts with our suppliers and we generally purchase our products under short-term purchase
orders. Although we believe that alternative sources of supply are currently available, an unplanned shift to a new supplier could
result in product delays and increased cost, which may have a material impact on our operations.
Competition
The electronics industry is highly competitive across all product categories, and we compete with a number of
well-established companies that manufacture and sell similar products. Brand name, design, advancement of technology and features
as well as price are the major competitive factors within the electronics industry. Our Mobile Electronic products compete against
factory-supplied products, including those provided by, among others, General Motors, Ford and Chrysler. Our Mobile Electronic
products also compete in the automotive aftermarket against major companies such as Sony, Panasonic, Kenwood, Directed
Electronics, Autopage, Rosen, Myron and Davis, Coby, Phillips, Insignia, and Pioneer. Our Accessories and Consumer Electronics
product lines compete against major companies such as Sony, Phillips, Coby, Emerson Radio, Jasco and Belkin.
Financial Information About Foreign and Domestic Operations
The amounts of net sales and long-lived assets, attributable to foreign and domestic operations for all periods presented are
set forth in Note 14 of the Notes to Consolidated Financials Statements, included herein.
8
Source: AUDIOVOX CORP, 10-K, May 14, 2010 Powered by Morningstar® Document Research℠